SHANGHAI, Oct 23 (SMM) –
Copper: Bearish sentiment about Brexit weighed on copper prices as developments overnight meant the deadline for the UK to leave the EU would likely be delayed again. CMX gold prices stabilised around $1,500/mt, which also pressured prices of the industrial metal. Three-month LME copper fell to a low of $5,811.5/mt and ended lower for the second straight session at $5,826/mt. The most-traded SHFE December contract closed down 0.19% at 47,030 yuan/mt. Weaker-than-expected US home sales grew worries about slower global growth and intensified expectations of another interest rate cut by the US Federal Reserve. Today, the SHFE contract is seen trading between 46,800-47,100 yuan/mt with LME copper at $5,780-5,820/mt. Spot premiums are expected at 40-80 yuan/mt.
Aluminium: A rallied US dollar index depressed aluminium prices as three-month LME aluminium extended its previous decline and ended down 0.29% at $1,719/mt, with the most-traded SHFE December contract trimming gains and closed slightly higher on the day at 13,950 yuan/mt. There is limited upward room in LME aluminium, which may trade between $1,705-1,730/mt with the SHFE contract at 13,740-13,840 yuan/mt today.
Zinc: Three-month LME zinc climbed steadily along with the daily moving average to around $2,480/mt, but it gave up gains and ended down 0.34% at $2,460.5/mt, on the back of negative developments on Brexit overnight. However, limited downside room is expected in prices given lower LME zinc inventories, a firm backwardation structure, and easing trade tensions between China and the US. The most-active SHFE December contract fell for the third consecutive session as it slipped to a low of 18,800 yuan/mt and closed down 0.61% at 18,815 yuan/mt. Loaded-up bearish positions overnight may keep the contract under pressure. Today, it is likely to trade between 18,700-19,200 yuan/mt with LME zinc between $2,440-2,490/mt.
Nickel: Three-month LME nickel recovered from seven straight sessions of decline as the LME started to review recent trading in the nickel market following the biggest-ever decline in inventories. It shrugged off resistance from the five-day moving average and hit a high of $16,645/mt, ending up 2.95% at $16,560/mt. The most-active SHFE December contract also rebounded, to close 3.95% higher on the day at 131,190 yuan/mt. The contract is expected to test support from 130,000 yuan/mt today, with LME nickel facing resistance above from $16,700/mt.
Lead: Pullback in three-month LME lead continued as it fell on a higher US dollar, closing down 0.52% at $2,199.5/mt. However, potential upward momentum is seen as long positions still dominated the market. The most-active SHFE December contract broke support from the 60-day moving average as shorts loaded up their positions, ending 0.56% lower at 16,720 yuan/mt. Bearish technical signals and weak fundamentals may further weigh on prices today.
Tin: A stronger SHFE tin and higher crude oil prices lifted three-month LME tin, which recovered from a low of $16,660/mt and closed higher at $16,920/mt. The most-traded SHFE January 2020 contract increased overnight after opened at 137,850 yuan/mt, ending 1,400 yuan/mt higher on the day at 139,200 yuan/mt, as investors covered their short positions and added longs. Resistance above is seen from 140,000 yuan/mt, with pressure for LME tin expected from $17,000/mt today.