SMM Evening Comments (Dec 1): Shanghai nonferrous metals declined for the most part, aluminium advanced 1.71%

Published: Dec 01, 2020 18:00 (GMT+8)

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SHFE nonferrous metals broadly fell on Tuesday December 1.

SHANGHAI, Dec 1 (SMM) – SHFE nonferrous metals broadly fell on Tuesday December 1.

Shanghai nonferrous metals, except for copper and aluminium, traded lower on Tuesday December 1. Nickel dropped 2.59% to lead the losses, zinc shed 0.42%, tin declined 2%, and lead fell 1.77%, while aluminium advanced 1.71% and copper climbed 0.21%.

A total of 101 vessels carrying 14.63 million mt of iron ore arrived at major Chinese ports during November 22-28, SMM estimates. This was up 110,000 mt from the previous week but down 1.45 million mt from the same period last year.

The ferrous complex closed mixed. Hot-rolled coil advanced 0.36%, iron ore rose 0.28%, while rebar fell 0.69%.

Copper: The most-traded SHFE 2101 copper contract finished the day 0.21% higher at 57,040 yuan/mt. Open interest fell 18,000 lots to 138,000 lots. Last night, the US economic data performed normal, PMI was lower than expectations, and pending home sales index dropped 1.1% month on month, which led to the fall of the three major stock indexes of US stocks, and the long position sentiment slowed down to some extent. In addition, the US dollar index rebounded to above 92, which also inhibited the continuous increase of copper prices. Federal Reserve Chairman Powell said that although the recent news about COVID-19 vaccine is very positive, there are still major challenges and uncertain factors. In addition, the surge of COVID-19 pneumonia cases in the US still makes the prospects of the US economy particularly uncertain. Market sentiment gradually turned to caution, which led to the long positions leaving the market last night and copper prices rising slightly. US Markit manufacturing PMI for November will come under scrutiny tonight.

Aluminium: The most-liquid SHFE 2101 aluminium contract finished the day 1.71% higher at 16,615 yuan/mt. Open interest fell 6,617 lots to 155,680 lots.

Zinc: The most-active SHFE 2101 zinc contract closed down 0.42% at 21,315 yuan/mt. Open interest fell 11,248 lots to 97,466 lots.

Nickel: The most-traded SHFE 2102 nickel contract ended the day 2.59% lower at 119,240 yuan/mt today. Open interest fell 13,262 lots to 153,493 lots.

Lead: The most-traded SHFE 2101 lead contract fell to an intraday low of 15,110 yuan/mt after opening and ended the day 1.77% lower at 15,265 yuan/mt. Open interest fell 2,267 lots to 40,137 lots. On the fundamentals, prices of battery scrap are unlikely to drop, and the secondary lead premium fell, which provides certain support for lead prices. Whether the contract could move above five-day moving average will be monitored tonight.

Tin: The most-liquid SHFE 2101 tin contract climbed to a session high of 149,510 yuan/mt and finished the day 2% lower at 145,570 yuan/mt today. Open interest fell 2,933 lots to 7,406 lots.

Evening comments Copper Aluminium Zinc Nickel Lead Tin

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

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