SMM Evening Comments (Mar 30): Shanghai nonferrous metals closed mostly higher, copper fell 0.87%

SHANGHAI, Mar 30 (SMM) – SHFE nonferrous metals rose for the most part on Tuesday March 30. Global markets appear to be stabilizing following market nervousness in the US which overshadowed market sentiment last Friday.

Lead, the best performer, rose 2.36%, zinc advanced 0.48%, nickel went up 0.17% and tin gained 0.36%, while aluminium fell 0.6% and copper dropped 0.87%.

A total of 84 vessels carrying 11.29 million mt of iron ore arrived at major Chinese ports during March 21-27, SMM estimates. This was down 470,000 mt from the previous week, and basically unchanged from the same period last year.

The ferrous complex closed mixed. Iron ore decreased 0.86%, rebar slipped 0.14%, while hot-rolled coil rose 1.61%.

Copper: The most-traded SHFE 2105 copper contract finished the day 0.87% lower at 65,880 yuan/mt. Open interest fell 1,349 lots to 143,000 lots.

Biden is expected to announce an infrastructure stimulus plan focusing on transportation on Wednesday. Biden's infrastructure plan may be raised to a maximum of $4 trillion, including a tax increase of up to $3.5 trillion. The focus of the market has gradually shifted to new infrastructure. In addition, Waller, director of the Federal Reserve, said that the rise in bond yields is a good sign of economic recovery and should not be intervened. This also reflects that the US monetary policy has not completely turned around, which has alleviated the short position sentiment in the market to some extent. However, the yield of US bonds went up, with the yield of U.S. 10-year bonds breaking through the previous high of 1.7543%, continuing to brush up to the new high since January last year, and the spread between U.S. 2-year bonds and 10-year bonds expanded to the highest level since July 2015, which caused the U.S. dollar to surge over 93 and the copper futures to fall under pressure.

Eurozone economic prosperity index in March, US FHFA house price index in January and whether short position sentiment could continue will continue to come under scrutiny tonight.

Aluminium: The most-liquid SHFE 2105 aluminium contract finished the day 0.6% lower at 17,345 yuan/mt. Open interest fell 5,537 lots to 214,173 lots.

Zinc: The most-active SHFE 2105 zinc contract closed up 0.48% at 21,860 yuan/mt. Open interest fell 209 lots to 83,855 lots.

Nickel: The most-traded SHFE 2106 nickel contract ended the day 0.17% higher at 123,500 yuan/mt today. Open interest rose 5,269 lots to 141,952 lots.

Lead: The most-traded SHFE 2105 lead contract ended the day 2.36% higher at 15,425 yuan/mt. Open interest rose 4,716 lots to 41,529 lots.

Tin: The most-liquid SHFE 2105 tin contract fell to a session low of 174,640 yuan/mt and finished the day 0.12% higher at 175,510 yuan/mt today. Open interest fell 3,303 lots to 16,370 lots. The yield of US 10-year bonds rose to 1.7550%, which caused inflation concerns due to accelerated vaccination and large-scale stimulus in the US. The contract is expected to keep fluctuating in the near term. Pressure above will be seen from 176,000 yuan/mt today. Support below will be seen from 170,000 yuan/mt today.