SMM Evening Comments (Jun 8): Shanghai nonferrous metals declined for the most part

Published: Jun 8, 2021 18:00

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SHFE nonferrous metals broadly fell on Tuesday June 7.

SHANGHAI, Jun 8 (SMM) – SHFE nonferrous metals broadly fell on Tuesday June 8.

Shanghai nonferrous metals, except for lead, traded lower on Tuesday June 8. Nickel shed 1.19% to lead the losses, copper decreased 0.36%, aluminium declined 1.08%, zinc went down 0.07% and tin fell 0.16%, while lead advanced 0.4%.

The ferrous complex fell across the board. Hot-rolled coil went down 1.71%, iron ore shed 0.73%, and rebar fell 1.75%.

Copper: The most-traded SHFE 2107 copper contract finished the day 0.36% lower at 71,420 yuan/mt. Open interest fell 5,622 lots to 129,000 lots. The Federal Reserve's overnight reverse repurchase usage reached a record high on Monday, exceeding $486 billion. Deutsche Bank said that the Fed has a "low probability" that it will adjust its management interest rate in June. The European Central Bank's bond purchase in April and May far exceeded that of the four major countries, but it is still difficult to curb the rise in yield. The influence of Yellen's soothing speech was fading, and the dollar weakened again. Seasonally-adjusted GDP quarterly rate in the first quarter of the Eurozone, the April trade account of the US, and whether the contract could break through the pressure of 40-day moving average will be monitored tonight.

Aluminium: The most-liquid SHFE 2107 aluminium contract finished the day 1.08% lower at 18,260 yuan/mt. Open interest fell 4,742 lots to 193,041 lots.

Zinc: The most-active SHFE 2107 zinc contract closed down 0.07% at 22,505 yuan/mt. Open interest rose 2,347 lots to 201,890 lots. China's refined zinc output stood at 494,600 mt in May, down 2.06% or 10,400 mt on the month and up 4.32% on the year.

Nickel: The most-traded SHFE 2107 nickel contract ended the day 1.19% lower at 130,080 yuan/mt today. Open interest fell 6,616 lots to 111,659 lots. Domestic NPI output increased by 5.32% month on month to 35,700 mt (Ni content) in May 2021. Output of high-grade NPI rose 10% to 29,400 mt in metal content, while that of low-grade NPI dropped 12.1% to 6,300 mt in metal content.

Lead: The most-traded SHFE 2107 lead contract ended the day 0.4% higher at 15,050 yuan/mt. Open interest fell 1,364 lots to 77,659 lots. Recently, prices of raw materials for lead smelting was firm, while prices of spot lead ingots dropped again and again. The profits of smelters was diluted, and the discount of smelters narrowed slightly. IThe cost support of secondary lead, and whether the contract can maintain its daytime trend to stand firm over 15,000 yuan/mt will be monitored tonight.

Tin: The most-liquid SHFE 2107 tin contract fell to a session low of 203,210 yuan/mt and finished the day 0.16% lower at 204,360 yuan/mt today. Open interest fell 338 lots to 27,133 lots. The guidance of LME tin trend on the trend of SHFE tin will be monitored. The tight domestic spot supply constituted a certain support for SHFE tin. Pressure above will be seen from 210,000 yuan/mt today. Support below will be seen from 200,000 yuan/mt today.

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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