Crude oil hits new high in nearly five months, metals generally decline, SHFE zinc drops over 1%, SHFE gold rises above 800 yuan again! [SMM Daily Review]

SMM News on June 13:

Metal Market:

As of the daytime close, domestic market base metals generally fell, with only SHFE aluminum and SHFE lead rising together. SHFE aluminum rose by 0.49%, and SHFE lead rose by 0.27%. SHFE zinc led the decline with a drop of 1.09%, SHFE copper fell by 0.85%, and the rest of the metals all dropped slightly. Alumina fell by 1.38%, the main continuous contract of foundry aluminum fell by 0.03%.

In addition, the main continuous contract of lithium carbonate fell by 1.38%, the main continuous contract of silicon metal fell by 1.8%, and the main continuous contract of polysilicon fell by 0.49%. The main continuous contract of European container shipping rose by 2.76%.

On the ferrous metals series front, most prices fell. Stainless steel fell by 0.24%, rebar fell by 0.2%, and HRC fell by 0.26%. In the coking coal and coke sector, coking coal rose by 0.06%, and coke rose by 0.75%.

In the overseas market, as of 15:05, overseas market base metals collectively fell, with LME copper and LME zinc both falling over 1%. LME copper fell by 1.1%, and LME zinc fell by 1.21%. The declines of the remaining metals were all within 1%.

In the precious metals sector, as of 15:05, COMEX gold fell by 0.97%, reaching a high of $3,467 per ounce during the session, hitting a new high since April 22. COMEX silver fell by 0.36%. Domestically, SHFE gold rose by 1.72%, reaching a high of 801.14 yuan per gram during the session, hitting a new high since May 8. SHFE silver fell by 0.49%.

Market conditions as of 15:05 today

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Macro Front

Domestic front:

[Guangzhou: Optimizing Real Estate Policies by Fully Lifting Purchase, Sales, and Price Restrictions, and Reducing Loan Down Payment Ratios and Interest Rates] The "Implementation Plan for Special Actions to Boost Consumption in Guangzhou (Draft for Public Comment)" is open for public comment. It mentions that consumption restrictions will be reduced in an orderly manner. Real estate policies will be optimized by fully lifting purchase, sales, and price restrictions, and reducing loan down payment ratios and interest rates. This will better meet housing consumption needs. Solid progress will be made in the renovation of urban villages and old residential communities. In 2025, it is planned to promote the renovation of over 150 old residential communities, replace over 9,000 old elevators in residential buildings, and complete fixed asset investment of 100 billion yuan in the renovation of urban villages. The use of special loans to purchase existing commercial housing as resettlement housing will be promoted. The policy on the use of housing provident funds will be continuously optimized, supporting depositors in applying for individual housing loans from housing provident funds while withdrawing housing provident funds to pay for down payments on home purchases, and further optimizing policy measures for rent withdrawal.

►The central parity rate of the RMB against the US dollar in the inter-bank foreign exchange market on June 13 was 7.1772 yuan per US dollar.

US dollar front:

As of 15:05, the US dollar index rose by 0.3% to 98.15. US PPI data fell short of expectations, with initial jobless claims reaching a new high since October last year. Expectations for a US Fed interest rate cut in September continued to rise. US PPI in May increased by 2.6% YoY, in line with expectations. US PPI in May rose by 0.1% MoM, missing expectations of 0.2%. The number of initial jobless claims in the US for the week ending June 7 reached 248,000, the highest since the week of October 5, 2024. Traders now expect the US Fed to cut interest rates by 55 basis points before the end of the year, starting in September instead of the previously anticipated October.

Macro:

Today, data including China's M2 money supply annual rate for May (the exact time between June 13-17 is uncertain), China's aggregate financing to the real economy year-to-date for May, China's new RMB loans year-to-date for May, the preliminary US University of Michigan consumer sentiment index for June, the eurozone's seasonally adjusted trade balance for April, the eurozone's total reserve assets for May, the final annual CPI rate for Germany in May, the monthly manufacturing sales rate for Canada in April, and the monthly new orders rate for Canada's manufacturing sector in April will be released. Additionally, the National Energy Administration typically releases data on total electricity consumption around the 15th of each month.

Crude Oil:

Due to renewed concerns about supply disruptions, as of 15:05, oil prices in both markets surged by over 5%, with US crude oil rising by 5.54% and Brent crude oil increasing by 5.41%. US crude oil briefly reached $77.64 per barrel, the highest since January 20, while Brent crude oil briefly hit $78.5 per barrel, the highest since January 23, both marking new highs in nearly five months.

Analysts from ING reported, "This significantly increases the uncertainty surrounding geopolitical risks, requiring the oil market to price in a larger risk premium for any potential supply disruptions."

SMM Daily Review

►June 13: The SHFE aluminum squeeze remains unresolved, with the market witnessing "negative processing fees" for aluminum billets [Daily Review of Spot Aluminum Billets]

►[SMM Daily Review of Nickel Sulphate] June 13: Nickel salt prices remained stable.

►[SMM Daily Review of MHP] June 13: Indonesian MHP prices slightly declined.

SMM Weekly Review

►Mid-year negotiation results begin to emerge, with KK mine's copper production target slashed by 28% [SMM Weekly Review of Spot Copper Concentrates]

►Deteriorating price ratios lead to inactivity from both buyers and sellers, with Yangshan copper premiums remaining at low levels [SMM Weekly Review of Yangshan Copper]

►Smelters continue to fulfill prior contracts, with domestic TCs remaining stable [SMM Weekly Review of Zinc Concentrates]

►This week's sales promotions boosted operating rates, but market demand is gradually weakening [SMM Weekly Review of Wire and Cable Market]