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SMM Evening Comments (Sep 25)
Sep 25,2019 18:29CST
price review forecast
SHFE nonferrous metals, except for lead, closed lower on Wednesday, with nickel leading the losses and dipping 1.6%

SHANGHAI, Sep 25 (SMM) – SHFE nonferrous metals, except for lead, closed lower on Wednesday September 25. Nickel led the losses and fell 1.6%, zinc slipped 1.2%, aluminium dipped 0.7%, tin lost 0.5%, and copper shed 0.2%. 

The ferrous complex also traded lower as iron ore decreased 1.7%, coke slid 2.3%, coking coal fell 1%, rebar dropped 0.5%, and hot-rolled coil eased 0.3%.

Stainless steel ended down 0.1% on its first trading day on the Shanghai Futures Exchange.  

Copper: The most-liquid SHFE November copper extended overnight declines as departing longs drove it to a low of 46,960 yuan/mt, before it ended down 0.23% at 47,000 yuan/mt. Risk aversion intensified as investors feared that an impeachment enquiry into US President Donald Trump would pile on more uncertainty to the global economy. Lower oil prices on a surprise rise in US crude inventory also dented demand outlook and pressured copper prices. Tonight, limited upward momentum will see the contract testing support from 47,000 yuan/mt. 

Aluminium: As longs took profits from previous gains, the most-liquid SHFE November contract slipped and ended the trading day at a low of 14,110 yuan/mt, down 0.7%. The contract is likely to extend the weak trend tonight. 

Zinc: The most-traded SHFE November contract hovered rangebound with pressure from the Bollinger upper band, ending down for the fifth consecutive day by 1.19% at 18,660 yuan/mt. Loaded-up shorts and uncertainty around macroeconomic development depressed upward momentum in the contract, but prices found some support from tightness in the spot market. The contract is expected to test support from the daily moving average tonight. 

Nickel: The most-liquid SHFE contract continued to trend downsides but stopped decline at 135,140 yuan/mt with support from the Bollinger middle band. It finished the trading day 1.57% lower at 136,080 yuan/mt. Capitals shifted to back-month SHFE contracts as open interest in the November contract lost 52,000 lots with a combined rise of 62,000 lots in the December and January 2020 contracts. Support from the Bollinger middle band and the 135,000 yuan/mt level will be monitored tonight. 

Lead: The most-active SHFE November contract ended a four-day losing streak as it climbed to an intraday high of 16,965 yuan/mt and ended 0.81% higher on the day at 16,900 yuan/mt, as Jiyuan of Henan province activated anti-smog alert and boosted confidence in longs. Risk aversion ahead of the holiday will likely prevent a significant capital inflow in base metal contracts. Tonight, the November contract may attempt to stand above 17,000 yuan/mt. 

Tin: The most-active SHFE January 2020 contract extended its rangebound trend and closed down 0.48% at 136,280 yuan/mt, the second straight session of decline. Support below is seen from 136,000 yuan/mt tonight. 

Evening comments
Futures movement

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