SMM Evening Comments (Jun 23): Shanghai nonferrous metals closed mostly higher ahead of PMI data

Published: Jun 23, 2021 18:00

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SHFE nonferrous metals broadly rose for the most part on Wednesday June 23 with investors awaiting key Purchasing Managers' Indexes from the euro zone.

SHANGHAI, Jun 23 (SMM) – SHFE nonferrous metals broadly rose for the most part on Wednesday June 23 with investors awaiting key Purchasing Managers' Indexes from the euro zone.

Tin, the best performer, rose 3.61%, copper advanced 2.03%, nickel went up 2.7%, zinc climbed 0.93% and aluminium gained 1.22%, while lead fell 0.32%.

The ferrous complex rose across the board. Iron ore surged 3.99%, rebar rose 1.44%, and hot-rolled coil climbed 0.66%.

Copper: The most-traded SHFE 2108 copper contract finished the day 2.03% higher at 68,480 yuan/mt. Open interest fell 7,894 lots to 80,005 lots. Federal Reserve Chairman Powell reiterated that the recent price increase was larger than expected due to the economic restart, but inflation may fall in the future. The Fed will be patient in raising interest rates, and will not preemptively raise interest rates because employment is too high or it is worried about inflation. The Fed has just started to debate on reducing its debt purchase, but it is still far away from the discussion on raising interest rates. San Francisco Fed President said that the US economy has not yet reached the conditions to support debt reduction. With Powell's two consecutive soothing speeches, the market sentiment has picked up. The European Central Bank's speech and the initial value of Markit manufacturing PMI in June in the USt and Europe, and whether the contract could stand firm above the five-day moving average will continue to be monitored tonight.

Aluminium: The most-liquid SHFE 2107 aluminium contract finished the day 1.22% higher at 18,725 yuan/mt. Open interest fell 7,876 lots to 103,854 lots.

Zinc: The most-active SHFE 2107 zinc contract closed up 0.93% at 21,820 yuan/mt. Open interest fell 13,324 lots to 52,112 lots.

Nickel: The most-traded SHFE 2107 nickel contract ended the day 2.7% higher at 133,700 yuan/mt today. Open interest fell 4,819 lots to 91,254 lots.

Lead: The most-traded SHFE 2107 lead contract ended the day 0.32% lower at 15,415 yuan/mt. Open interest fell 4,715 lots to 27,165 lots. Smelters' enthusiasm for shipping increased, and the circulation supply was relatively sufficient, but the downstream purchased for rigid demand due to the high prices. Whether the contract could stand firm above 15,500 yuan/mt will be monitored tonight.

Tin: The most-liquid SHFE 2108 tin contract fell to a session low of 201,340 yuan/mt and finished the day 2.71% higher at 207,830 yuan/mt today. Open interest rose 4,277 lots to 41,143 lots. The market's worries about the shortage of spot supply supported the sharp rise of tin prices. Tin prices are expected to remain high in the near term. Pressure above will be seen from 201,000 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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