SHANGHAI, Mar 27 (SMM) – SHFE nonferrous metals rose across the board on Friday March 27, as investors hoped that Beijing would roll out more monetary and fiscal measures to bolster its economy.
Market sentiment was also lifted by the news that leaders of the Group of 20 major economies will inject over $5 trillion into the global economy to counter the impact from the COVID-19 and “do whatever it takes to overcome the pandemic.”
SHFE zinc led the increases with a rise of 3.01%. Copper advanced 0.26%, aluminium climbed 0.73%, lead added 1.95%, tin gained 2.82%, and nickel went up 1.17%.
The ferrous complex ended mixed as iron ore shed 0.15%, rebar grew 0.66%, while hot-rolled coil rose 0.52%, stainless steel climbed 0.75%, and coke closed up 0.25%.
The anticipation increased for China’s storage of metals, a move aimed at propping up the market after the recent COVID-19 driven plunges in metal prices. SMM learned that some companies have filed relative reports to the government.
The SHFE has suspended night trading session until further notice.
Copper: The most-active SHFE May contract hovered around 39,000 yuan/mt for the third consecutive day, as it bounced back after dipping to a session low of 38,730 yuan/mt. With limited upward momentum, it failed to break up 40,000 yuan/mt and finished the day 0.26% higher at 39,180 yuan/mt. Spot trades in Shanghai were brisk as investors bet that more supportive measures from the government will revive consumption. However, there were lingering concerns about a global economic recession with record-high jobless claims and rising COVID-19 cases in the US. The SHFE contract is expected to test support from 39,100 yuan/mt with continued resistance from 40,000 yuan/mt.
Aluminium: Improved market sentiment buoyed the most-traded SHFE May contract after it slipped to a session low of 11,575 yuan/mt. It finished 0.73% higher on the day at 11,740 yuan/mt. Trading range is expected between 11,400-11,900 yuan/mt next week.
Zinc: The most-traded SHFE May contract rebounded from a session low of 14,985 yuan/mt as rising hopes of stimulus measures drove longs to enter. The contract ended the day 3.01% higher at 15,385 yuan/mt, firm above the five- and 10- day moving averages. SMM data showed that social inventories of refined zinc in China extended their decline this week as demand picked up. Fundamentals may see zinc prices in a recovery mode in the near term.
Nickel: The most-active SHFE June contract ended a four-day losing streak as short-covering lifted it to an intraday high of 93,460 yuan/mt. It closed the day 1.17% higher at 93,440 yuan/mt, with open interest down 8,037 lots to 87,401 lots. The contract is expected to test support from the five-day moving average next week.
Lead: The most-liquid SHFE May contract climbed steadily today, hitting an intraday high of 13,895 yuan/mt and ending up 1.95% on the day at 13,845 yuan/mt. A rebounded LME lead also supported the contract. The contract may try to stand above 14,000 yuan/mt next week.
Tin: The most-active SHFE June contract moved higher to close to 120,000 yuan/mt and trimmed some gains to end at 119,400 yuan/mt, up 2.82% on the day. Support below is seen from 114,000-115,000 yuan/mt with pressure above from 120,000 yuan/mt.