Minutes of SMM Bronze Morning meeting on July 17
[7.17 SMM Bronze Morning minutes] Macro: 1) Trump reiterated at the White House Cabinet meeting that he could impose more tariffs on Chinese imports if he wanted to. The US stock market fell back and the offshore renminbi resumed its decline. 2) Fed Chairman Powell said the Fed is "closely monitoring" the downward risks of US economic growth and "will take appropriate action to maintain expansion"; the uncertainty of the outlook has increased, especially in terms of trade development and global economic growth. 3) US manufacturing output rose more than expected in June; retail sales rose more than expected in June; home builders increased confidence in July and lower mortgage rates are helping to support demand. Last night, U. S. economic data sharply lowered expectations of a U. S. interest rate cut, and the dollar rallied 97.4 positions. Fundamentals: 1) scrap copper: yesterday refined scrap price difference of 1679 yuan / ton. For one or two months in a row, scrap copper holders have maintained the mood of holding goods and cherishing sales, and shipped less; recently, the price difference of refined scrap copper rods has widened, attracting part of the downstream to switch to scrap copper rod consumption, and at the same time, due to financial pressure, scrap copper holders have a small number of shipments. 2) imported copper: yesterday's import loss of about 50 yuan / ton. Yesterday, market prices still showed a high stalemate, with only a small number of transactions. At present, in addition to long single replenishment or individual terminal demand, it is difficult to have a centralized demand, the activity of the foreign trade market continues to be light, and the price fluctuation is not obvious. 3) stocks: LME copper stocks increased by 7100 tons to 292925 tons on July 16, while copper stocks in the previous period decreased by 1706 tons to 64217 tons. 4) spot: spot due to the sharp decline last night, it is expected that the low price is expected to attract downstream buying, the holder is willing to maintain the price. It is expected that the spot water will rise by 10 yuan to 90 yuan per ton today. Copper prices and forecasts: last night, both inside and outside the market showed a high decline trend, Lun Copper below the 6000 level, Shanghai copper rushed to 47280 yuan / ton and then fell below the 47000 level. Mainly because last night's US retail sales data for June exceeded expectations, the Fed is unlikely to lower by 50 basis points in July, last night the dollar rose 97.4 levels, copper prices fell under pressure. At present, due to the excellent performance of US economic data, it is not conducive to the further strengthening of the US dollar, which is not conducive to the continued uptick of copper prices. In terms of crude oil, after the downgrade of the Gulf of Mexico storm, the output of crude oil supply has increased, and oil prices have continued to fall below the 57 mark, which is also bad news for copper prices. At present, Shanghai copper close Yin, the upper shadow line pressure 60-day moving average, KDJ index opening has a downward expansion trend, the technical side of a small negative copper price. It is expected to be 5940 US $5980 / ton and 46700 / 47000 yuan / ton of Shanghai copper today.
(SMM Kwong Tze-si)
