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SMM Evening Comments (May 24): Shanghai nonferrous metals fell across the board, aluminium dropped 3.52%

iconMay 24, 2021 18:00
SHFE nonferrous metals broadly fell on Monday May 24 as investors continued to focus on inflation concerns.

SHANGHAI, May 24 (SMM) – SHFE nonferrous metals broadly fell on Monday May 24 as investors continued to focus on inflation concerns.

Aluminium led the losses and slumped 3.52%, copper slipped 1.36%, nickel eased 1.82%, zinc lost 1.05%, tin went down 1.41% and lead decreased 1.7%.

The ferrous complex fell across the board. Hot-rolled coil went down 3.9%, iron ore shed 5.21%, and rebar fell 3.57%.

Copper: The most-traded SHFE 2107 copper contract finished the day 1.36% lower at 71,640 yuan/mt. Open interest rose 5,166 lots to 132,000 lots.

In the Ut, the PMI of service industry and manufacturing industry reached a new record high in May, the economic recovery was still strong, and the US dollar index went up. A number of state Federal Reserve presidents all voiced the adjustment of easing policy, and the discussion on the contraction of bond purchase program "sooner rather than later" also supported the dollar to stop falling and recover to a certain extent. The European Central Bank remained dovish, and the yield of European government bonds fell collectively. The president of the Nonferrous Metals Industry Association voiced over the weekend that the price increase of bulk commodities seriously deviated from the industrial operation price chain, and the hype institutions should not underestimate the determination of regulation and control, and the suppression of domestic policies also gave the market short confidence to a certain extent.

Chicago Fed National Activity Index for April and whether the contract could stop the decline under the support of economic data will be monitored tonight.

Aluminium: The most-liquid SHFE 2107 aluminium contract finished the day 3.52% lower at 18,105 yuan/mt. Open interest fell 9,035 lots to 235,330 lots.

Zinc: The most-active SHFE 2107 zinc contract closed down 1.05% at 22,155 yuan/mt. Open interest rose 312 lots to 83,644 lots. In order to discuss the easing policy of code reduction, several regional Federal Reserve Presidents in the US gave a briefing, and five departments interviewed key enterprises such as ferrous metals, copper and aluminium over the weekend to maintain the order of commodity prices. Nonferrous metals collectively adjusted back, and zinc prices fluctuated and weakened. However, the upgrade of Yunnan's power curtailment policy affected the supply of zinc ingots in smelters and inhibited the decline of zinc prices. The pressure position along the BOLL line above will be monitored tonight. The contract w is expected to fluctuate at low.

Nickel: The most-traded SHFE 2107 nickel contract ended the day 1.82% lower at 123,880 yuan/mt today. Open interest rose 107 lots to 111,642 lots.

Lead: The most-traded SHFE 2107 lead contract ended the day 1.63% higher at 15,420 yuan/mt. Open interest rose 2,970 lots to 41,783 lots. Social inventories of lead ingots across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin rose 3,300 mt from last Friday May 21 to 93,900 mt as of Monday May 24, an SMM survey showed. The stocks were up 8,000 mt from last Monday May 17, reaching a high level since May 2015. The contract will test support from 15,400 yuan/mt tonight.

Tin: The most-liquid SHFE 2107 tin contract fell to a session low of 191,430 yuan/mt and finished the day 2.21% lower at 192,930 yuan/mt today. Open interest fell 1,233 lots to 33,186 lots. Domestic market issued guidance on commodity price increase, and the trading atmosphere in commodity market cooled down. The upgrade of power curtailment measures in Yunnan caused most tin plants in Gejiu area to stop production, and the spot shortage in SHFE tin market further intensified. The contract is expected to fluctuate at high in the near term. Pressure above will be seen from 200,000 yuan/mt today. Support below will be seen from 192,000 yuan/mt today.

Evening comments

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