Market Risk Appetite Declines, Most-Traded BC Copper Contract Closes Lower [SMM BC Copper Commentary]

SMM March 11 News: Today, the most-traded BC copper 2504 futures contract opened at 69,760 yuan/mt, closing with a bearish candlestick, with the lower shadow piercing through the 10-day and 20-day moving averages. Overnight, the most-traded BC copper 04 contract fluctuated downward as shorts reduced positions, briefly reaching a high of 69,780 yuan/mt. During the morning trading session, the market plunged following the exit of bulls, hitting bottom at 68,820 yuan/mt before rebounding and stabilizing above 69,000 yuan/mt. In the afternoon trading session, the most-traded BC copper 04 contract saw its center continue to rebound as shorts closed positions to take profits, eventually settling at 69,420 yuan/mt, down 630 yuan/mt or 0.90%. The decline was mainly attributed to long liquidation, with open interest decreasing to 7,503 lots, down 928 lots from the previous trading day, and trading volume reaching 7,054 lots, a decrease of 1,368 lots from the previous day.

Macro side, recent US economic data and the labour market weakened, coupled with the impact of Trump’s policies, heightening market concerns over the risk of US "stagflation." This led to a decline in market risk appetite, dragging down copper prices. However, the current fundamentals still provide support on the downside, and the intraday decline in the futures market narrowed.

The SHFE copper 2504 contract settled at 78,030 yuan/mt. Based on the BC copper 2504 contract price of 69,420 yuan/mt, its post-tax price is approximately 78,445 yuan/mt. The price spread between the SHFE copper 2504 contract and the BC copper 2504 contract was -415 yuan/mt, with the spread remaining inverted and narrowing compared to the previous trading day.