SMM Evening Comments (Jan 17): Shanghai Nonferrous Metals Closed Mixed with Market Players Bracing for CNY Holiday

Published: Jan 17, 2023 18:00
China's economy withstood the pressure and managed to take another step forward, and the prospect in 2023 is exciting. Nonetheless, the market is already in the holiday atmosphere.

SHANGHAI, Jan 17 (SMM) – Shanghai nonferrous metals closed mixed in day trading. According to National Bureau of Statistics, with preliminary accounting, the annual GDP stood at 121,020.07 billion yuan based on constant prices, an increase of 3.0% over the previous year. China's economy withstood the pressure and managed to take another step forward, and the prospect in 2023 is exciting. Nonetheless, the market is already in the holiday atmosphere.

Shanghai copper dropped 0.29%, aluminium rose 0.46%, lead added 0.33%, zinc lost 0.54%, tin fell 0.85%, and nickel grew 0.35%.

Copper: The most-traded SHFE 2303 copper closed down 0.29% or 200 yuan/mt at 68,400 yuan/mt, with open interest down 4,068 lots to 193,550 lots.

The spot market was increasingly quiet approaching the Chinese New Year (CNY) holiday. SHFE 2302 and 2303 spread was around -100 yuan/mt.

Aluminium: The most-traded SHFE 2302 aluminium closed up 0.46% or 85 yuan/mt at 18,580 yuan/mt, with open interest down 5,196 lots to 90,681 lots.

Overseas macro data was positive recently, and China released a series of favourable policies, boosting market confidence. However, due to poor downstream demand ahead of the upcoming CNY holiday and rapidly rising inventory, aluminium prices will have limited upside room.

Lead: The most-traded SHFE 2303 lead closed up 0.33% or 50 yuan/mt at 15,370 yuan/mt, with open interest down 683 lots to 78,905 lots.

SHFE lead consolidated today. The cargo holders were discouraged from shipping amid halting logistics services and downstream players closing for CNY holiday. The market transactions weakened further.

Zinc: The most-traded SHFE 2303 zinc closed down 0.54% or 130 yuan/mt at 24,120 yuan/mt, with open interest up 11,481 lots to 87,414 lots.

The spot market was extremely quiet today as most traders and downstream players were already on holiday, featuring few quotations and scarce market inquiries.

Tin: The most-traded SHFE 2303 tin closed down 0.85% or 1,930 yuan/mt at 224,610 yuan/mt, with open interest up 5,196 lots to 45,342 lots.

In the spot market, most traders have been closed for CNY holiday, and the trading market was quiet. SHFE warrants inventory fell 2 mt to 6,446 mt.

Nickel: The most-traded SHFE 2302 nickel closed up 0.35% or 710 yuan/mt at 204,800 yuan/mt, with open interest down 7,536 lots to 28,686 lots.

In the spot market, Jinchuan nickel was in premiums of 11,000-12,000 yuan/mt, with an average of 11,500 yuan/mt, down 750 yuan/mt from a day ago. NORNICKEL nickel was in premiums of 6,700-7,200 yuan/mt, with an average of 6,950 yuan/mt, down 200 yuan/mt from the previous trading day. Spot premiums dropped across the board today as SHFE nickel fell, and market transactions were muted. For nickel briquette, the prices stood between 208,500-209,000 yuan/mt, down 750 yuan/mt on a daily basis.

[Disclaimer: The above representation and data is based on market information SMM believes to be reliable at the time of acquiring as well as the comprehensive assessment by SMM research team, and any and all information provided in this article is for reference only. This article does not constitute a direct recommendation for investment or any decisions in any form and clients shall act on their own discreet and any decisions made by clients are not within the responsibility of SMM.]

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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