Most metals decline across the board, alumina rises over 3%, polysilicon gains more than 2%, while coking coal, coke and iron ore all fall over 2% [SMM Daily Review]

SMM, May 8:

Metal Market:

As of the daytime close, domestic market base metals generally declined, with only SHFE lead rising, up 0.24%. The rest of the metals fell, with SHFE copper leading the decline at 0.9%, followed by SHFE zinc, which dropped 0.78%. The declines in other metals fluctuated slightly. The main alumina contract rose 3.25%.

In addition, the main lithium carbonate contract fell 0.77%, the main polysilicon contract rose 2.43%, and the main silicon metal contract fell 0.36%. The main European container shipping contract fell 3.64%.

The ferrous metals series declined collectively, with iron ore leading the decline at 2.73%. Rebar and HRC both fell over 1%, with rebar down 1.74% and HRC down 1.18%. In the coking coal and coke segment, coke fell 2.25%, and coking coal fell 2.13%.

In the overseas market, as of 15:03, overseas market base metals, except for LME tin, all declined. LME tin rose 0.46%, LME lead fell 0.79%, LME zinc fell 0.59%, and LME copper fell 0.49%. The rest of the metals declined slightly.

In precious metals, as of 15:03, COMEX gold fell 1.7%, and COMEX silver fell 0.84%. Domestically, SHFE gold fell 1.41%, and SHFE silver fell 1.78%.

Market conditions as of 15:03 today

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Macro Front

Domestic:

[Zheng Bei, Deputy Director of the National Development and Reform Commission (NDRC): High-quality projects with a total investment of about 3 trillion yuan will be launched this year] Zheng Bei, Deputy Director of the National Development and Reform Commission (NDRC), stated at a State Council Information Office press conference that the full text of the Private Enterprise Promotion Law embodies the principles of equal treatment, fair competition, equal protection, and common development. The NDRC will focus on promoting implementation in areas such as breaking down barriers, expanding opportunities, and optimizing services. In terms of expanding opportunities, support will be given to private enterprises to actively participate in the "implementation of major national strategies and the development of security capabilities in key areas" and the "program of large-scale equipment upgrades and consumer goods trade-ins." Efforts are being accelerated to improve the long-term mechanism for private enterprises to participate in major national projects. The NDRC has launched a batch of major projects in fields such as nuclear power and railways. Currently, the shareholding ratio of private capital in some nuclear power projects has reached 20%. In the fields of industrial equipment renewal and recycling, the capital contribution of some private enterprises exceeds 80%. Zheng Bei revealed that this year, high-quality projects with a total investment of about 3 trillion yuan will be launched in key areas such as transportation, energy, water conservancy, new-type infrastructure, and urban infrastructure. Zheng Bei also stated that during the legislative process of the Private Economy Promotion Law, the NDRC, in coordination with relevant departments, has planned in advance and simultaneously carried out the formulation, revision, abolition, and interpretation of related systems. A batch of supporting systems have already been issued.She stated that a batch of supporting systems are being accelerated for implementation; meanwhile, in promoting technological innovation, service guarantees, and rights protection, many localities are actively improving relevant supporting measures based on local realities. Click for details

[Deputy Director of the Financial Regulatory Administration, Lin Cong: 12.6 trillion yuan in new loans have been issued to small and micro entities through the coordination mechanism supporting small and micro enterprise financing] Deputy Director of the Financial Regulatory Administration, Lin Cong, stated at a press conference of the State Council Information Office that the Financial Regulatory Administration has collaborated to create an information sharing mechanism. Offline, the Financial Regulatory Administration, together with the National Development and Reform Commission (NDRC), established a coordination mechanism supporting small and micro enterprise financing, promoting the direct delivery of credit funds to the grassroots level, which is fast, convenient, and at appropriate interest rates. Through this mechanism, 12.6 trillion yuan in new loans have been issued to small and micro entities, with an average interest rate of 3.66%. Online, the promotion of credit information sharing and comprehensive financial service platforms in multiple regions has been driven, allowing data to travel more and enterprises and banks to travel less, supporting banks in issuing credit loans with data information. By the end of Q1, the balance of credit loans for private enterprises was 18.1 trillion yuan, up 15.4% YoY.

► On May 8, the central parity rate of the RMB in the interbank foreign exchange market was 7.2073 yuan per US dollar.

On the US dollar side:

As of 15:03, the US dollar index rose 0.3% to 100.18. On May 7 local time, the US Fed released its interest rate decision statement, announcing that the target range for the federal funds rate would remain at 4.25% to 4.50%, marking the third consecutive time since January this year that the US Fed has kept rates unchanged. In the latest monetary policy statement, the US Fed stated that the uncertainty of the economic outlook has further intensified, and the risks of rising unemployment and inflation have increased. At the press conference, Powell denied any idea of preemptive interest rate cuts. When discussing the prospects for rate cuts, Powell said that situations suitable for rate cuts or maintaining the status quo may arise in the future. No predictions can be made now, and we will have to wait until June. Traders expect that the US Fed will cut rates by 77 basis points starting from September this year. (Wenhua Comprehensive)

On the data side:

Today, Germany's seasonally adjusted industrial production MoM for March, Germany's working-day adjusted industrial production YoY for March, Germany's seasonally adjusted exports MoM for March, the UK's central bank benchmark interest rate for May, the US initial jobless claims for the week ending May 3, the US continuing jobless claims for the week ending April 26, the US wholesale inventories MoM final for March, the US New York Fed's 1-year inflation expectations for April, and the US New York Fed's 3-year inflation expectations for April will be released.Also to watch: The US Fed's Federal Open Market Committee (FOMC) will announce its interest rate decision; Fed Chairman Powell will hold a press conference on monetary policy; the Bank of England will announce its interest rate decision.

Crude oil:

As of 15:03, oil prices in both markets rose simultaneously, with US crude oil up 0.38% and Brent crude oil up 0.31%. Signs of easing trade tensions improved market sentiment, triggering a rebound in oil prices in an oversold market. However, after the US Fed kept interest rates unchanged but warned of rising economic uncertainty, concerns about weak demand limited the rise in oil prices.

Last week, US gasoline inventories increased, exacerbating concerns about weak demand and prompting analysts to worry that consumption would not increase as the US entered the summer demand period later this month. Meanwhile, the Organization of the Petroleum Exporting Countries (OPEC) and its allies will increase oil production, adding pressure to oil prices. (Wenhua Comprehensive)

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