SMM2, March 25: most non-ferrous metals were red yesterday, and the price of copper futures on the London Metal Exchange (LME) hit a nine-and-a-half-year high on Wednesday on the back of a weaker dollar, low inventories and hopes that demand will increase as major economies recover from the effects of the epidemic. Analysts pointed out that after looking at the macro background, I think there is still room for the next three months or so. The macro theme of strong growth and rising inflation is likely to be the main theme. The LME metal market was all red this morning. As of 09:50, Lun Copper rose nearly 2.4%, Lun Zinc nearly 0.7%, Lun Al nearly 1.5%, Lun Ni nearly 0.3%, Lunxi nearly 3%, Lun lead nearly 0.8%. On the domestic side, international copper rose nearly 3.6%, Shanghai Copper rose nearly 3.5%, Shanghai Aluminum rose nearly 4.8%, Shanghai lead rose nearly 1.3%, and Shanghai Zinc rose nearly 0.7%. Shanghai nickel rose nearly 2.4%, and Shanghai tin rose nearly 4.8%.
On the copper side, on the macro front, Federal Reserve Chairman Colin Powell reiterated the view that the economy needs loose policy support to appease concerns about inflation and economic overheating. As risk appetite heats up, the three major indexes of US stocks open lower and higher, and the Dow hits another all-time high. Signs of a sustained economic recovery and optimistic investor expectations continue to boost market risk appetite. The macro mood remained optimistic, the momentum of copper futures remained, and the inside and outside markets continued to rise at night. Spot, the spot market buying fear of high sentiment is still the same, holders under financial pressure to actively sell goods for cash, so that the rise of water quickly released for two days in a row. It is expected to be 9450-9530 US dollars / ton for Lun Copper and 68500-69000 yuan / ton for Shanghai Copper today. It is expected that today's spot discount 200-discount 100 yuan / ton.
[SMM International Copper Morning News] the Federal Reserve continues to send dove signals BC copper continues to rise.
In terms of aluminum, the recent production reduction news of electrolytic aluminum plants in Inner Mongolia has short-term stimulated the sharp rise in Shanghai aluminum disk, and the original aluminum import window has been opened again. Macro short-term easing and basic interest double resonance, Shanghai Aluminum is still a strong upward momentum in the short term, the medium-term focus on long short mood changes, or there may be high long positions to make a profit to leave the market. Fundamentals are concerned about the impact of the mismatch between domestic supply and demand on short-term mood fluctuations in the market after the Spring Festival. Domestic unilateral recommendations for bargain-seeking appropriate layout of long; domestic recommendations to continue to hold the positive set; internal and external recommendations to try anti-set.
[minutes of SMM Morning meeting] rumors of production reduction in electrolytic aluminum plants stimulate Shanghai Aluminum to break new highs and pay close attention to the actual production reduction time and quantity in the short term.
Lead, overnight, lun lead first suppressed and then rose, rising in the atmosphere of the decline of the dollar index and the general rebound of LME base metals, followed by a long shadow. During the day, lun lead may continue the trend of high shock, with a focus on 2100 yuan / ton support below. Overnight, Shanghai lead followed the rise to recover part of the daytime decline, closed higher on the 5-day moving average, and walked out of Dayangzhu. Industrial recovery is expected to boost market confidence after the year, and the bullish rally in the non-ferrous metals sector may not be over yet. Shanghai lead is supported by high shocks in this background, but there is no obvious bright spot in downstream consumption for the time being. Pay attention to whether Shanghai lead can stabilize its 5-day moving average during the day.
[minutes of SMM Morning meeting] lead prices will strengthen overnight in and out of the market. Short-term lead prices may continue to fluctuate at high levels.
In terms of zinc, overnight Shanghai zinc basically hit bottom, the short mentality is better, while the bulls remain cautious and did not substantially increase their positions. Domestic zinc processing costs have been maintained at a low level recently, the supply side remains tight, and zinc ore processing fees are expected to be slightly reduced in March to support zinc prices. On the other hand, pay attention to whether the low zinc price will boost the sentiment of downstream enterprises to receive goods. The price of lun zinc is expected to operate in the range of US $2830 to US $2,880 per ton. It is expected that the main 2104 contract price of Shanghai zinc will run in the range of 21300 to 21800 yuan / ton, and it is expected that domestic zinc will fall by 60 yuan / ton.
[minutes of SMM Morning meeting] Shanghai Zinc bounces back to the bottom slightly and pays attention to the mood of receiving goods downstream.
In terms of nickel, from a fundamental point of view, the medium-and long-term nickel market is more, but the overall red rise of non-ferrous metals after the Spring Festival is still due to macro-inflationary sentiment, and the current prices need to take into account the sustainability of market sentiment. In terms of risk factors, we need to take into account the weaker-than-expected global economic recovery, changes in Fed monetary policy, the uncertainty of the epidemic and other black swan events. We should also pay continuous attention to the fundamentals. Early speculative bulls continue to reduce positions, putting great pressure on the short-term price of nickel. It is estimated that this week, Shanghai nickel is 140000-150000 yuan / ton, Lunni is 19000-21000 US dollars / ton.
[minutes of SMM Morning meeting] Nickel price center of gravity falls back to spot trading resumes limited high nickel pig iron transaction strength
In terms of black, thread rose by nearly 2.5%, hot coil by nearly 1.7%, coking coal by nearly 3.3%, coke by nearly 2%, iron ore by nearly 1.7%, stainless steel by nearly 1.7%, and hot coil by nearly 1.7%. As for hot rolls, the acceptance of orders by major steel mills is nearing the end of March. According to SMM tracking understanding, in the market for terminal demand is generally more optimistic expectations, the actual steel factory orders slightly less than expected. Overall, the major major steel mills in March to accept orders in the basic card just full of tight balance, the degree of popularity is significantly lower than at the end of 2020. However, this does not mean that the mentality of steel mills will weaken accordingly. According to feedback, at a time when the novel coronavirus epidemic is improving and the global economy is gradually recovering, steel mills still have a more optimistic attitude towards domestic and foreign terminal demand and are more willing to raise prices. The profit of superimposed plate production has rebounded, prompting the steel mills to be in full production except for necessary maintenance.
[minutes of SMM Morning meeting] Iron ore supply is hard to see. Incremental prices still have some support.
Crude oil rose nearly 2.9 per cent in the previous period, and crude oil futures prices climbed to a 13-month high on Wednesday after US government data showed that crude oil production fell last week as crude oil production was interrupted after extremely cold weather. Total crude oil production fell 1.1 million b / d to 9.7 million b / d in the week to February 19, the largest weekly decline in history, and refinery capacity also fell sharply, according to the US Energy Information Administration ((EIA)). Severe cold forced the suspension of most Electroweb operations in Texas, and oil producers and refineries were forced to close because parts and pipelines were frozen.
In terms of precious metals, Shanghai gold fell nearly 0.7%, while Shanghai silver rose nearly 0.7%. Comex gold futures closed lower on Wednesday, closing lower for the second day in a row, and closed below the key $1800 an ounce for the first time this week, despite the support of Fed Chairman Colin Powell's dovish speech, but gold prices remained difficult as rising US bond yields undermined gold's attractiveness as a hedge against inflation.
As of 09:30, the status of contracts in the metals and crude oil markets:
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