[October 17 SMM lead internal morning meeting record] reducing lead market supply is increasingly abundant recycled refined lead to maintain a deep discount

Summary of lead morning meeting:

Macro:

The US president said it was likely to sign a trade agreement with the Chinese president at the APEC summit in November. China has begun purchasing US agricultural products.

British and EU officials played down the possibility of a Brexit agreement on Wednesday night, as the EU and Britain made progress on Ireland's customs border, but obstacles remained.

Us overnight economic data: retail sales fell unexpectedly for the first time in seven months in September, which could add to the reasons for the Fed to cut interest rates for the third time. Confidence among homebuilders climbed to its highest level since February 2018 in October as borrowing costs strengthened and the job market strengthened.

In deploying and utilizing foreign capital, the State Council of China requires that foreign-funded enterprises should not be forced to transfer technology in disguise, and that the restrictions on the business scope of foreign banks, securities companies and fund management companies in China should be completely abolished.

China will allow foreign investment bonds to be transferred non-tradable between QFII/RQFII and direct investment from Nov. 15.

Fundamentals:

Shanghai lead exploration low rebounded, after delivery, the holder quoted price, and forced the original lead, recycled lead refinery shipments to maintain deep discount, the trade market price discount is larger than yesterday, among them, the Shanghai market Jinsha, southern, Mudun lead to the 1911 contract discount 20 yuan / ton to the flat water quotation, Wuxi market Jingui lead to the 1911 contract discount 20 yuan / ton, white goods can be discounted 5040 yuan / ton, the primary lead refinery is mainly based on long orders. Some of the loose orders are quoted to the average price of SMM1# lead discount 50-150 yuan / ton ex-factory; In the aspect of recycled lead, the circulation supply of reduced lead market is becoming more and more abundant, the shipments of refineries are strong, the price is falling, recycled refined lead maintains deep discount, the downstream demand is limited, and the overall market transaction is still relatively light.

Lead price:

Lun lead is basically in line with the previous judgment that we are in line with the technical trend, and we have recently focused on the pressure of US $2200 / ton. Under the weak fundamental expectations, the domestic lead buying power depends entirely on Lun lead, and if the lead falls back, it should be followed closely by Shanghai lead.

SMM1# lead prices are expected to rise by 100-150 yuan per ton today.