SMM Morning Comments (Nov 7)-Shanghai Metals Market

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SMM Morning Comments (Nov 7)

Price Review & Forecast 09:37:25AM Nov 07, 2019 Source:SMM

SHANGHAI, Nov 7 (SMM) – 

Copper: Possible delay on US-China trade deal reignited risk aversion overnight. This, coupled with reduced prices of crude oil, pressure by greater-than-expected buildup in US inventories, dented the upward momentum in copper prices. Three-month LME copper slipped to a low of $5,869/mt and finished down 1.05% at $5,884.5/mt, with the most-liquid SHFE December contract ending 0.08% lower at 46,150 yuan/mt. Fundamentals prospect remained weak for the fourth quarter, showed an SMM survey. Today, the SHFE contract is seen trading between 47,000-47,400 yuan/mt with LME copper at $5,850-5,900/mt. Spot premiums are likely at 80-100 yuan/mt. 

Aluminium: Three-month LME aluminium lacked continuous upward momentum, ending lower on the day at $1,803/mt. The most-traded SHFE December contract continued to move sideways and finished 5 yuan/mt lower at 13,950 yuan/mt. The release of SMM aluminium inventories data should be watched today. Trading range of the contract is seen at 13,900-14,000 yuan/mt today with that for LME aluminium at $1,790-1,810/mt. 

Zinc: Three-month LME zinc extended losses from the previous session as it lost 1.1% to close at $2,473.5/mt. The decline was capped by support from the 20-day moving average and reduced LME zinc inventories. The most-liquid SHFE December contract was on track for a third straight session of decline, easing 0.32% and finished at 18,680 yuan/mt. An underperformed LME zinc and a high US dollar depressed the contract, which is expected to hover weakly between 18,500-19,000 yuan/mt today. LME zinc is seen trading at $2,460-2,510/mt today. 

Nickel: Three-month LME nickel remained in a rangebound trend as it lost all the daily gains to hit a low of $16,120/mt, after climbed to a high of $16,460/mt, ending down 0.4% at $16,230/mt. The most-active SHFE December contract breached the 130,000 yuan/mt level to a low of 129,470 yuan/mt, finishing at 130,350 yuan/mt. Support from 130,000 yuan/mt and $16,200/mt, respectively, will be monitored today. 

Lead: Decline in most base metals during the Asian trading hours accelerated the downward movement in three-month LME lead, which lost support from all moving averages to a low of $2,101/mt. It trimmed gains from the past month, finishing 2.12% lower at $2,105/mt. Prices may limitedly pull back in the short term. The most-traded SHFE December contract closed lower for the sixth straight session by 0.86%, at 16,105 yuan/mt. It will also see limited upside in the near term. 

Tin: While most base metals fell overnight, prices of tin recovered from previous losses even as stockpiles across LME-listed warehouses grew 425 mt, to 6,540 mt. Three-month LME tin finished $95/mt higher at $16,545/mt, and the most-traded SHFE January 2020 contract stabilised at lows, ending at 136,580 yuan/mt. Today, the SHFE contract may test support from 136,000 yuan/mt, with LME tin facing resistance from $16,700/mt. 

SMM Morning Comments (Nov 7)

Price Review & Forecast 09:37:25AM Nov 07, 2019 Source:SMM

SHANGHAI, Nov 7 (SMM) – 

Copper: Possible delay on US-China trade deal reignited risk aversion overnight. This, coupled with reduced prices of crude oil, pressure by greater-than-expected buildup in US inventories, dented the upward momentum in copper prices. Three-month LME copper slipped to a low of $5,869/mt and finished down 1.05% at $5,884.5/mt, with the most-liquid SHFE December contract ending 0.08% lower at 46,150 yuan/mt. Fundamentals prospect remained weak for the fourth quarter, showed an SMM survey. Today, the SHFE contract is seen trading between 47,000-47,400 yuan/mt with LME copper at $5,850-5,900/mt. Spot premiums are likely at 80-100 yuan/mt. 

Aluminium: Three-month LME aluminium lacked continuous upward momentum, ending lower on the day at $1,803/mt. The most-traded SHFE December contract continued to move sideways and finished 5 yuan/mt lower at 13,950 yuan/mt. The release of SMM aluminium inventories data should be watched today. Trading range of the contract is seen at 13,900-14,000 yuan/mt today with that for LME aluminium at $1,790-1,810/mt. 

Zinc: Three-month LME zinc extended losses from the previous session as it lost 1.1% to close at $2,473.5/mt. The decline was capped by support from the 20-day moving average and reduced LME zinc inventories. The most-liquid SHFE December contract was on track for a third straight session of decline, easing 0.32% and finished at 18,680 yuan/mt. An underperformed LME zinc and a high US dollar depressed the contract, which is expected to hover weakly between 18,500-19,000 yuan/mt today. LME zinc is seen trading at $2,460-2,510/mt today. 

Nickel: Three-month LME nickel remained in a rangebound trend as it lost all the daily gains to hit a low of $16,120/mt, after climbed to a high of $16,460/mt, ending down 0.4% at $16,230/mt. The most-active SHFE December contract breached the 130,000 yuan/mt level to a low of 129,470 yuan/mt, finishing at 130,350 yuan/mt. Support from 130,000 yuan/mt and $16,200/mt, respectively, will be monitored today. 

Lead: Decline in most base metals during the Asian trading hours accelerated the downward movement in three-month LME lead, which lost support from all moving averages to a low of $2,101/mt. It trimmed gains from the past month, finishing 2.12% lower at $2,105/mt. Prices may limitedly pull back in the short term. The most-traded SHFE December contract closed lower for the sixth straight session by 0.86%, at 16,105 yuan/mt. It will also see limited upside in the near term. 

Tin: While most base metals fell overnight, prices of tin recovered from previous losses even as stockpiles across LME-listed warehouses grew 425 mt, to 6,540 mt. Three-month LME tin finished $95/mt higher at $16,545/mt, and the most-traded SHFE January 2020 contract stabilised at lows, ending at 136,580 yuan/mt. Today, the SHFE contract may test support from 136,000 yuan/mt, with LME tin facing resistance from $16,700/mt.