US dollar falls for two consecutive days, domestic market base metals generally rise, SHFE zinc rises by over 2%, alumina records four consecutive negative days [overnight market]

The 2025 SMM (3rd) Wire and Cable Industry Development Conference & Wire and Cable Industry Exhibition concluded successfully!

SMM reported on May 26:

Metal Market:

Overnight, domestic metals generally rose, with only SHFE lead and SHFE nickel declining together. SHFE nickel fell by 0.22%, and SHFE lead by 0.06%. SHFE zinc led the gains with a significant increase of 2.03%, while other metals saw increases within 1%. The main alumina futures contract fell by 3.26%, recording a four-day losing streak.

The ferrous metals series collectively declined, with iron ore falling by 0.77% and HRC by 0.67%. In the coking coal and coke segment, coking coal fell by 0.75%, and coke by 1.09%.

In the overseas market, the LME metal market was closed for the day due to the Spring Bank Holiday.

Precious Metals: As of the overnight close, COMEX gold fell by 0.7%, while COMEX silver rose by 0.11%. Domestically, SHFE gold fell by 0.23%, and SHFE silver rose by 0.29%.

Overnight closing market conditions as of 8:16 AM on May 27

》Click to view SMM Futures Data Dashboard

Macro Front

Domestic Developments:

The General Office of the CPC Central Committee and the General Office of the State Council issued opinions on improving the modern enterprise system with Chinese characteristics. The opinions comprehensively and systematically outline measures in areas such as upholding and strengthening the Party's leadership, improving corporate governance structures, enhancing scientific management levels of enterprises, strengthening incentive and innovation systems for enterprises, establishing and improving corporate social responsibility and corporate culture systems, and optimizing comprehensive supervision and service systems for enterprises. The focus is on empowering enterprise development through institutional innovation, further releasing the vitality of micro-entities, and cultivating more dynamic, resilient, and competitive modern enterprises, providing strong support for comprehensively advancing the construction of a strong country and national rejuvenation through Chinese-style modernization.

The Party Committee of the State-owned Assets Supervision and Administration Commission of the State Council (SASAC) held an expanded meeting on May 26, mentioning the need to accelerate the cultivation of pioneering enterprises, leading enterprises, and unicorn enterprises. Efforts should be made to greatly enhance the resilience and security of industrial and supply chains, strengthen the construction of computing power infrastructure, deepen the co-chain initiative for the integrated development of industrial chains, and accelerate the formation of strategic safeguard capabilities in areas such as manufacturing equipment, basic materials, and key parts and components.

Cui Dongshu, Secretary General of the China Passenger Car Association, wrote that global auto sales reached 7.56 million units in April 2025, up 5% YoY. From January to April 2025, China accounted for 33% of global auto sales, with the lower share of Chinese automakers at the beginning of the year being a normal reflection of the Chinese New Year factor. As the effects of policy stimuli become evident, the Chinese auto market has strengthened since March-April.

US Dollar:

The US dollar index fell by 0.12% overnight, closing at 98.98. It fell to as low as 98.69 during the session, hitting a new low since April 22. US Fed Governor Christopher Waller recently warned that the current fiscal trend is "simply unsustainable." The bond market has responded accordingly, with long-term Treasury yields breaking through the 5.0% mark, clearly indicating that investors are demanding higher compensation to address perceived US credit risks. The market currently expects mild easing, but the conditional nature of these expectations reflects market skepticism about Washington's ability to effectively coordinate policies. Rising tariffs could simultaneously push up prices and weaken economic growth, a stagflation risk that will limit the Fed's flexibility, despite the current federal funds target rate range of 4.25%-4.50%.

In other currencies:

The euro hit a one-month high against the US dollar on Monday after US President Trump abandoned his threat to impose 50% tariffs on EU goods starting June 1, with the EU requesting time to "reach a good deal."

The US dollar continued to fall against multiple currencies, as Trump's major policy U-turn and the comprehensive spending and tax cut bills he is currently pushing have deterred investors from US assets. Ray Attrill, head of foreign exchange research at National Australia Bank (NAB), said, "The 'sell the US' theme that dominated the market in April has re-emerged. The market may have formed a judgment—and it may be correct—that tariffs between the US and the EU will not ultimately reach 50%, but how this outcome will be achieved is, frankly, anyone's guess at this point."

The euro climbed 0.55% earlier against the US dollar to reach $1.1418, the first time since April 29. The euro closed up 0.2% on Monday, closing at $1.1386, with a year-to-date gain of 10%. Over the past few months, the US dollar's decline has largely benefited the euro, as investors have turned their attention to a range of non-US markets. European Central Bank President Christine Lagarde said on Monday that if member governments can strengthen the eurozone's financial and security architecture, the euro could become a viable substitute for the US dollar, bringing significant benefits to the eurozone.

In terms of data:

Today, data such as China's year-on-year profit growth rate for industrial enterprises above designated size in April (single month), the initial estimate of the month-on-month change in US durable goods orders for April, the US Conference Board's consumer confidence index for May, the eurozone's economic sentiment index for May, the eurozone's industrial sentiment index for May, the final estimate of the eurozone's consumer confidence index for May, Germany's Gfk consumer confidence index for June, the UK's CBI retail sales balance for May, and Australia's ANZ consumer confidence index for the week ending May 25 will be released.

Crude oil:

Oil prices fluctuated in the two markets overnight, with Brent crude falling by 0.05% and WTI crude closing at $61.53 per barrel. The market is waiting for clarity on OPEC+'s next move. The US market was closed on Monday for the Memorial Day holiday, resulting in sluggish trading. According to RIA Novosti, Russian Deputy Prime Minister Alexander Novak said on Monday that OPEC+ had not yet discussed increasing production by an additional 411,000 barrels per day.

Rory Johnston, founder of Commodity Context and a Toronto-based analyst, said that investors and traders are still expecting OPEC to increase production, but they are reluctant to make significant moves until there is substantive progress. Johnston pointed out that despite the original production increase plan taking effect, OPEC's oil production still declined slightly in April, making the overall market more hesitant. "The market's current reaction to them is to wait for any (substantive) action," he said. (Wenhua Comprehensive)