US dollar falls, metals rise nearly across the board, SHFE tin up over 3%, coking coal up over 7% [SMM Daily Review]

SMM News on June 4:

Metal Market:

As of the daytime close, domestic market base metals collectively rose, with SHFE tin leading the gains with a 3.14% increase, while the gains of other metals were all within 1%. The main alumina contract rose by 2.17%.

In addition, the main lithium carbonate contract rose by 2.55%, the main silicon metal contract rose by 2.9%, and the main polysilicon contract rose by 0.44%. The main European container shipping contract rose by 6.86%.

On the ferrous metals series front, prices collectively rose, with stainless steel up by 0.59%, and the gains of other metals all exceeding 1%. Iron ore, rebar, and HRC all rose by more than 1%, with iron ore up by 1.37%, rebar up by 1.57%, and HRC up by 1.61%. Coking coal and coke surged significantly, with coking coal up by 7.19% and coke up by 5.72%.

In the overseas market, as of 15:08, overseas market base metals all rose except for LME copper, which fell by 0.05%. LME tin led the gains with a 1.17% increase, while the gains of other metals were all within 1%.

In the precious metals sector, as of 15:08, COMEX gold rose by 0.06%, and COMEX silver fell by 0.17%. Domestically, SHFE gold fell by 0.41%, and SHFE silver rose by 0.05%.

Market movements as of 15:08 today

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Macro Front

Domestic Developments:

[Announcement: The State Council Information Office will hold a press conference at 10 a.m. on June 6 regarding economic and trade cooperation between China and South Asia, as well as the 9th China-South Asia Expo] The State Council Information Office will hold a press conference at 10 a.m. on June 6, 2025 (Friday). Yan Dong, Vice Minister of Commerce, and Liu Yong, Vice Governor of Yunnan Province, will introduce the economic and trade cooperation between China and South Asia, as well as the 9th China-South Asia Expo, and answer questions from reporters.

[PBOC's Open Market Operations Net Withdraw 600 Million Yuan Today] The PBOC conducted 214.9 billion yuan of 7-day reverse repo operations today. As 215.5 billion yuan of 7-day reverse repos matured today, a net withdrawal of 600 million yuan was realized on the day.

[PBOC's Stimulus Policy Package Ensures Overall Controllable Market Liquidity in June] Against the backdrop of continued monetary policy efforts, the funding market remained loose, achieving a smooth transition across the month-end. As of the close on June 3, funding rates across all tenors declined. The DR007 weighted average rate, an indicator reflecting liquidity conditions, fell sharply by 11.49 basis points to 1.5496%. Analysts believe that overall market liquidity is controllable. It is expected that with the combined effects of precise reverse repo operations and fiscal expenditures in early June, funding rates are likely to remain low, and sentiment in the bond market may stabilize and rebound. (Cailian Press)

►On June 4, the central parity rate of the RMB exchange rate in the interbank foreign exchange market was set at 7.1886 RMB per US dollar.

US dollar:

As of 15:08, the US dollar index fell by 0.12% to 99.15. According to CCTV News, on June 3 local time, the US White House issued a statement saying that US President Trump announced an increase in tariffs on imported steel, aluminum, and their derivative products from 25% to 50%, effective from 00:01 AM EST on June 4, 2025. Atlanta Fed President Bostic said on Tuesday that the strong economy gives the US Fed time to assess how tariffs will affect inflation and growth, and he remains open to the possibility of an interest rate cut later this year. Chicago Fed President Goolsbee said on Tuesday that inflation resulting from US import tariffs may soon become apparent, but he noted that it will take longer to see the economic slowdown caused by tariffs. (Wenhua Comprehensive)

Macro:

Today, data including Australia's Q1 seasonally adjusted GDP quarter-on-quarter rate, Australia's Q1 GDP year-on-year rate, Russia's May SPGI Services PMI, the final value of the UK's May SPGI Services PMI, the change in the US's May ADP employment, Canada's total reserve assets in May, Brazil's May seasonally adjusted SPGI Services PMI, the Bank of Canada's overnight lending rate on June 5, and the US's May ISM Non-Manufacturing PMI will be released. In addition, it is worth noting that: 2025 FOMC voter and Chicago Fed President Goolsbee will participate in a Q&A session; 2027 FOMC voter, Atlanta Fed President Bostic, and Fed Governor Lisa Cook will attend the "Fed Listens" event; the Bank of Canada will announce its interest rate decision.

Crude oil:

As of 15:08, oil prices in both markets fell simultaneously, with US crude oil down 0.39% and Brent crude oil down 0.35%. Pressured by the increase in OPEC+ production and concerns about the global economic outlook overshadowed by tariff tensions, but supported to some extent by concerns about Canadian supply.

Analysts are weighing the impact of OPEC+'s production increase and the wildfire situation in Canada on oil market supply. The market still expects the wildfires that have swept across Canada since May to curb supply, despite temporary relief from wet weather. However, analysts at ING said in a client note: "This relief may be short-lived, as the weather is expected to become drier and warmer by the end of the week."

Some analysts expect that the reduction in Canadian supply will offset more than half of the production increase planned by OPEC next month. Commenting on the impact of the wildfires, SEB analyst Ole Hvalbye said, "It is estimated that around 350,000 barrels per day of oil have been affected and shut down." "Against this backdrop, the scale of this supply disruption exceeds three-quarters of the production increase that OPEC+ agreed to add to the market in July." (Wenhua Comprehensive)

SMM Daily Review

►Aluminum prices rebound, aluminum scrap market adjusts prices differently [Aluminum Scrap Daily Review]

►[SMM Nickel Sulphate Daily Review] June 4: Nickel salt prices remain stable

►Rare earths remain at a stalemate upstream and downstream, prices continue to run smoothly [SMM Rare Earths Daily Review]

►Cost-driven, tungsten products such as ammonium paratungstate and tungsten powder continue to rise [SMM Tungsten Daily Review]

►Silver prices fluctuate at highs, downstream cautiously purchases and waits on the sidelines amidst rigid demand [SMM Daily Review]