[July 16, SMM lead internal morning meeting record]

Summary of the lead morning meeting:

Macro:

It is reported that in order to influence the tax recovery period and other factors, the people's Bank of China maintained a reasonable and abundant liquidity in the banking system. On July 15, 2019, the people's Bank of China carried out incremental operations on small and medium-sized banks, with a total operation volume of 200 billion yuan, on the basis of the 188.5 billion yuan medium-term loan facility (MLF) due on the same day.

Yesterday, the National Bureau of Statistics released the main data on China's economic operation in the second quarter of 2019. The important items include the following: 1) Industrial value added grew by 6.3% in June, expected to be 5.2%, and the former value was 5%. 2) the total retail sales of consumer goods in June was 8.8%, which was expected to be 8.5%, compared with the previous value of 8.6%; 3) fixed asset investment from January to June was 5.8% from a year earlier, with an expected 5.6%. 4) in the second quarter of 2019, GDP grew by 6.2%, expected to be 6.2%, with a previous value of 6.4%. Whether in terms of supply-side production, or in terms of demand-side investment and consumption growth, the June data significantly exceeded market expectations, and the growth rate rebounded significantly.

Fundamentals:

Shanghai lead exploration low recovery, coupled with the delivery of today's value, the quotation of the holder follows the market, and the market price of high water is reduced, among them, the Shanghai market Jinsha lead to 1908 contract water 50 yuan / ton quotation, Mulun lead to 1908 contract flat water quotation, Jiangsu and Zhejiang Jinli, copper crown lead to 1908 contract water 0 to 10 yuan / ton quotation, and the original lead refinery bulk single mainstream quotation to SMM1# lead average price; Recycled lead, reduced lead market supply did not see signs of improvement, the market transaction price is almost the same as last Friday, refined lead factory only carefully picked, recycled lead mainstream quotation SMM1# lead price discount 100yuan / ton factory; but downstream demand is not prosperous, storage enterprises are only rigid demand procurement, bulk market transaction activity is general.

Lead price:

Lun lead rose for many days in a row, reaching the US $2000 mark above, paying short-term attention to whether it can effectively break through, and Shanghai lead entity Changyang got rid of the suppression of the Yin line and gradually raised its center of gravity, but the fundamentals have not seen any obvious improvement yet. In the short term, it is expected to be dominated by concussion.

In addition, the value of Shanghai lead 1907 contract was delivered yesterday, and the settlement price was 15990 yuan / ton, which was lower than the intraday settlement price of 1908 contract (16065 yuan / ton). With reference to yesterday's electrolytic lead transaction price in the trade market, the traders who took over the source of delivery had considerable profit space; the delivery volume was 16575 tons, nearly double the normal delivery volume, to a certain extent, it may cause the market to worry about the lead price in the future market.

The price of SMM1# lead is expected to rise by 50 to 100 yuan per ton today.