SHANGHAI, Aug 8 (SMM) – SHFE nonferrous metals ended mostly higher with nickel rising the maximum 5.99%. Lead gained 1.18%, copper rose 0.91%, tin climbed 0.83%, aluminium gained 0.22%, while zinc lost 1.37%.
The ferrous complex continued to close lower as iron ore settled down 2.65%, with rebar and hot-rolled coil dipping 1.05% and 0.44%, respectively.
Copper: Longs rallied the most-liquid SHFE October contract today, but it faced limited upward momentum as risk aversion sentiment remained strong in the market. The contract expanded to a high of 46,700 yuan/mt after opening and hovered between 46,500-46,580 yuan/mt for most of the day, ending up 0.91% on the day at 46,510 yuan/mt. It is expected to track its LME counterpart and test support from 46,500 yuan/mt tonight.
Aluminium: The announcement of output cuts of 50% across alumina refineries in Xiaoyi supported prices of aluminium, as the most-liquid SHFE September contract climbed to a high of 13,890 yuan/mt and settled 0.22% higher on the day at 13,885 yuan/mt. SMM retains its optimistic outlook on downstream consumption in September-October. Tonight, the contract is expected to receive support from 13,700 yuan/mt.
Zinc: The most-liquid SHFE October contract failed to hold firm above 18,800 yuan/mt as shorts loaded up their positions after the contract was pulled to a high of 18,850 yuan/mt by its LME counterpart. It finished at 18,665 yuan/mt, down 1.37% on the day, with open interests up 26,580 lots to 215,000 lots. Expectations of a better-supplied market are likely to keep the contract below the Bollinger lower band tonight.
Nickel: Aggressively loaded-up longs boosted the most-liquid SHFE October contract to a high of 124,890 yuan/mt in early trades, and settled it at that level, up by its daily limit. Open interests surged 2,216 lots to 468,000 lots, with 710 million yuan of capital flowing into all SHFE nickel contracts. The movement in longs should be closely watched tonight.
Lead: The most-active SHFE September contract again climbed to test pressure from the 16,800 yuan/mt level today, ending up 1.18% on the day at 16,780 yuan/mt. As moving averages expanded upwards and LME lead also strengthened, the contract may attempt to break resistance from 16,800 yuan/mt tonight.
Tin: The most-traded SHFE September contract came off after rising longs buoyed it to a high of 138,500 yuan/mt. It gave up nearly half of the gains in early trades and ended at 135,300 yuan/mt, up 0.83% on the day. Tonight, support below is seen from 133,500 yuan/mt, with pressure from 135,600 yuan/mt.