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SMM Evening Comments (Nov 12): Nonferrous metals on the SHFE mostly advanced, aluminium jumped 2.03%
Nov 12, 2020 18:47CST
Source:SMM
SHFE nonferrous metals rose for the most part on Thursday November 12. Aluminium, the best performer, jumped 2.03% to lead the gains, copper added 0.14%, lead advanced 0.44% and nickel firmed 0.46%, while zinc weakened 0.94% and tin shed 0.24%.  

SHANGHAI, Nov 12 (SMM) – SHFE nonferrous metals rose for the most part on Thursday November 12. Aluminium, the best performer, jumped 2.03% to lead the gains, copper added 0.14%, lead advanced 0.44% and nickel firmed 0.46%, while zinc weakened 0.94% and tin shed 0.24%.  

SMM data showed that stocks of 6063 aluminium billet across the five major consumption areas – Foshan, Wuxi, Huzhou, Changzhou and Nanchang – in China shrank 6,700 mt from last Friday November 6 to 87,900 mt as of November 12. Stocks fell sharply in Foshan, held largely unchanged in Wuxi, and rose slightly in Nanchang.

Social inventories of primary aluminium across eight consumption areas in China, including SHFE warrants, declined 25,000 mt from the prior week to 629,000 mt as of November 12.

Copper: The most-traded SHFE 2012 copper contract closed 0.14% higher on the day at 51,800 yuan/mt, with trading volume decreasing 11,000 lots.  

US incumbent President Donald Trump challenged election results in six States, attempting to overturn the results, but he may unlikely to win in any of these States. Good news of coronavirus vaccine will boost copper prices in the long run, but in the short term copper prices will still be capped by rising Cvoid-19 cases in the United States and Europe. US first-time filings for unemployment benefits in the past week will be watched tonight.

Aluminium: The most-traded SHFE 2012 aluminium contract jumped 2.03% to close the day at 15,350 yuan/mt, after hitting its highest since June 2018 of 15,415 yuan/mt earlier in the session, with open interest rising 2,468 lots to 158,000 lots. Consistent inflow of capitals and low inventories and warrants supported aluminium prices. Pressure above from 15,500 yuan/mt will be monitored tonight.  

Zinc: The most-liquid SHFE 2012 zinc contract moved along with the daily moving average today, ending 0.94% lower on the day at 20,020 yuan/mt, with open interest decreasing 7,686 lots to 85,233 lots. Environmental restrictions in north China and weaker consumption weighed on zinc prices. The contract may likely to remain weak tonight.

Nickel: The most-active SHFE 2102 nickel contract climbed to a nearly two-week high of 120,380 yuan/mt after the bell, but as shorts accumulated it ended the day just 0.46% higher at 119,010 yuan/mt, with open interest increasing 10,136 lots to 137,135 lots. Inventories at Chinese stainless steel mills have built up for several straight weeks as they kept high production while downstream consumption was moderate. Shrinking profits are likely to force mills to gradually reduce output of #300 stainless steel in the coming days, which may weigh on nickel prices.  

Lead: The most-traded SHFE 2012 lead contract finished the day 0.44% higher at 14,680 yuan/mt after hitting an intraday high of 14,690 yuan/mt in the afternoon session, with trading volume shrinking 3,087 lots to 33,973 lots. Tight supply of secondary lead underpinned lead prices, but tepid downstream consumption pressured lead prices.

Tin: The most-active SHFE 2101 tin contract slid 0.24% to close the day at 145,470 yuan/mt, and support below will be seen from 145,000 yuan/mt tonight.  

Market commentary
Copper
Aluminium
Lead
Tin
Nickel
Zinc

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