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[SMM Daily Review] Zinc in Shanghai fell by more than 1 per cent. Most of the floating green iron ore plummeted by 5.9 per cent in the black system.
Jul 5,2019 16:00CST
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Source:SMM
The content below was translated by Tencent automatically for reference.

SMM7, May 5: most of the non-ferrous metals are green today. By the end of the day, Shanghai zinc closed down 1.32%, Shanghai copper closed down 0.37%, Shanghai lead closed down 0.25%, Shanghai tin closed down 0.13%, Shanghai tin closed down 0.04%, Shanghai aluminum closed up 0.36%. On the news, Zambian Mining Minister Richard Musukwa said on Thursday that Zambia was planning to pass a law requiring mining companies to give local suppliers a fair chance when purchasing. Musukwa says Zambian mining imports are worth $4 billion a year, but only 10 per cent of that goes to local suppliers. This is another move by the Zambian government to intervene in the country's mining industry. "Zambia intends to pass laws to compel mining companies to procure locally

In the black system, iron ore plummeted 5.85%, thread closed down 1.21%, hot coil closed down 1%, coking coal closed down 0.26%, coke closed up 0.56%; Among them, iron ore, SMM believes that the collapse of iron ore disk today is mainly due to two pieces of news: the relevant state ministries and commissions will severely crack down on irregular price increases in iron ore, price monopoly, and other irregular behavior, while China's "imported iron ore working group" was set up to deal with major problems in the iron ore market. At present, the fundamentals of iron ore supply and demand have not been obviously weakened, affected by the suppression of the disk, and SMM expects iron ore prices to be sorted out in the near future or on the weak side. "[change] Iron ore multi-contract limit import iron ore working group set up

According to Huitong, Saudi Arabia is continuing its route of "reducing production and protecting oil prices," bringing OPEC's share of the global oil market this year to its lowest level in nearly 30 years. Since the rise of US shale oil, Saudi Arabia's production reduction strategy "failed", oil prices are still less than a year. Crude oil traders seem to have ignored the impact of OPEC production cuts on oil prices, and against a backdrop of long-term pressure on crude oil demand from the international trade situation, traders are looking forward to weekly EIA data in the United States. This has become the factual basis for the recent conformism of oil prices.

 

Capital flow today

 

In terms of capital flows, commodity market funds fled frantically for the fourth day in a row, industrial products became the hardest-hit areas, the black chain index lost 1.551 billion funds, iron ore and coke flowed out 911 million and 582 million respectively. White sugar performance is eye-catching, contributing $339 million to the soft commodity sector. The chemical sector was abandoned by funds, and PTA, which plummeted for three consecutive days, lost 155 million of its funds today.

SMM analyst's brief comment on July 5

 

Copper: today, Shanghai Copper main contract 1909 opened in the morning at 46480 yuan / ton, after the opening of the center of gravity maintained at about 46500 yuan / ton, and then short actively entered the market, the market all the way down to 46420 yuan / ton, and then the disk center of gravity basically maintained around 46420 yuan / ton, after the opening of afternoon trading, the center of gravity continued to maintain a slight shock in this position, after a short period of stability, copper prices continued to decline, and all the way down to the lowest level of 46270 yuan / ton in the day. The probe was followed by a rapid rebound, closing down 46320 yuan per ton, or 0.39 per cent, at the end of the day. Today, the main contract of Shanghai Copper was changed into 1909 contracts. Today, the position was increased by 9092 hands to 217000 hands, and the trading volume decreased by 13000 hands to 66000 hands. The Shanghai Copper Index increased its positions by 12000 to 620000 today, while capital inflows into the non-ferrous sector stood at 178 million today. Today, Shanghai copper as a whole showed a downward trend, mainly due to the fact that the market is looking forward to the US non-agricultural data, the trend of the US dollar is strong, and the copper price is under pressure. The market will judge whether the Federal Reserve is willing to cut interest rates in July according to the non-agricultural results. Will also guide the trend of copper prices; the basic copper market continues to remain light, not conducive to copper prices; Today, Shanghai copper closed negative, below the loss of all EMA support, KDJ indicators continue to expand under the negative, the technical side does not support copper prices. In the evening, we waited for the US non-agricultural data and the guidance of the outside market to test whether Shanghai Copper could hold the 46300 yuan / ton mark.

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