SHANGHAI, Aug 26 (SMM) — SHFE nonferrous metals rose for the most part on Wednesday August 26, as the supply of lead ingots improved and inventories of nickel ore shrank.
Shanghai nonferrous metals, except for lead, traded higher on Tuesday August 25. Copper increased 0.31%, aluminium added 0.96%, nickel surged 2.06%, tin rose 0.07% and zinc advanced 0.13%, while lead shed 1.07%.
Social inventories of long steel (including wire rods and rebar) in Guangzhou decreased 1.41%, or 18,400 mt, in the week ended August 26 to 1.28 million mt, showed SMM data. Stocks were 55.2% higher than the same period last year.
The ferrous complex closed mixed. Hot-rolled coil fell 0.66%, rebar shed 0.43%, while iron ore rose 0.73%.
Copper: The most-traded SHFE 2010 copper contract climbed to an intraday high of 51,480 yuan/mt in morning trading, and finished the day 0.31% higher at 51,440 yuan/mt. The first-stage economic and trade agreement between China and the US was implemented, and China promised to buy more US agricultural products. The relationship between the two sides released a positive signal and the market risk appetite improved. In addition, the US crude oil production has been greatly reduced in the near term due to hurricane transit, and inventories have continued to decline. The easing of the contradiction between crude oil supply and demand has supported oil prices and boosted copper prices.
The changes of EIA crude oil inventories in the US in the week ending August 21 and the data of durable goods orders in July will be monitored tonight.
Aluminium: The most-liquid SHFE 2010 aluminium contract ended 0.96% higher at 14,665 yuan/mt today. Open interest increased 8,989 lots to 110,000 lots as investors added their long positions. The basis and the flow of funds will come under scrutiny.
Zinc: The most-active SHFE 2010 zinc contract surged to an intraday high of 20,030 yuan/mt, before giving some gains to end 0.13% higher at 19,810 yuan/mt today. Open interest increased 1,913 lots to 105,000 lots. The contract is expected to fluctuate in the near term and support from the 10-day moving average will come under scrutiny.
Nickel: The most-traded SHFE 2011 nickel contract climbed to an intraday high of 119,940 yuan/mt, and finished the day 2.06% higher at 119,680 yuan/mt. The first-stage economic and trade agreement between China and the US was implemented. The relationship between the two sides released a positive signal, improving the market risk appetite. The news of workers' strikes came out from the Indonesian nickel iron factory yesterday, leading to the market’s worry about the supply side. Whether the contract could move above 120,000 yuan/mt will be monitored tonight.
Lead: The most-traded SHFE 2010 lead contract fell to an intraday low of 15,720 yuan/mt in morning trading as investors added their short positions, and finished the day 1.07% higher at 15,780 yuan/mt. The contract fell for five consecutive days. Whether the contract could remain above 15,600 yuan/mt will be monitored tonight.
Tin: The most-liquid SHFE 2011 tin contract rose to an intraday high of 142,090 yuan/mt, and closed 0.07% lower at 141,580 yuan/mt today. Open interest increased 2,803 lots to 21,070 lots. Pressure above is expected to around 10-day moving average of 142,500 yuan/mt.