With the lifting of the year-end inventory check factors for downstream enterprises, the spot market may resume regular trading [SMM Morning Lead Conference Summary]

Futures Market:

Last Friday, LME lead opened at $1,992.5/mt. During the Asian session, it fluctuated downward. Entering the European session, it touched a low of $1,989.5/mt before rebounding. It reached a high of $2,049.5/mt in the tail end of the session and closed at $2,041.5/mt, up 2.33%.

Last Friday evening, the most-traded SHFE lead 2508 contract opened at 17,105 yuan/mt. After briefly touching a low of 17,095 yuan/mt at the start of the session, it fluctuated upward. It reached a high of 17,195 yuan/mt in the tail end of the session and closed at 17,170 yuan/mt, up 0.37%.

》Click to view historical SMM lead spot quotes

Macro Aspects:

Trump stated that the US should keep interest rates at 1% or 2%; there is no need to extend the July 9 tariff deadline, but it could be extended, and it's not a big deal. US consumer spending unexpectedly fell by 0.1% in May, lower than the market expectation of a 0.1% increase. Inflation rose mildly, with the US May core PCE price index annual rate recording 2.7%, higher than the expected 2.6% and hitting a new high since February 2025. The US May core PCE price index monthly rate recorded 0.2%, higher than the market expectation of a flat 0.1%. Traders increased their bets that the US Fed will cut interest rates three times in 2025.

The 16th session of the Standing Committee of the 14th National People's Congress concluded in Beijing, voting to pass the newly revised Public Security Administration Punishment Law and the newly revised Anti-Unfair Competition Law. The People's Bank of China held its Q2 regular meeting, suggesting an increase in the intensity of monetary policy regulation. The China Securities Regulatory Commission (CSRC) strictly investigated financial fraud cases, and for the first time, held parties that facilitated fraud accountable simultaneously. The Shanghai and Shenzhen Stock Exchanges: proposed to adjust the price limit for risk warning stocks on the main board to 10%. Media: BYD halts "price war"! Starting from July 1, the nationwide limited-time "fixed price" policy will be canceled.

Spot Market Fundamentals:

Last Friday, SHFE lead surged and then relatively pulled back. Suppliers maintained discounted shipments, but downstream enterprises had a strong wait-and-see sentiment, with limited inquiries. Meanwhile, secondary lead enterprises' willingness to resume production increased, with more quotes and wider discounts for secondary refined lead, reported at a discount of 170-50 yuan/mt against the SMM 1# lead average price ex-factory, diverting limited rigid demand. The primary lead market saw sluggish transactions.

Inventory: On June 27, LME lead inventory increased by 175 mt to 273,425 mt. As of June 26, the total social inventory of SMM lead ingots in five locations reached 56,000 mt, unchanged from June 19 and up by over 300 mt from June 23.

》Click to view the SMM Metal Industry Chain Database

Today's Lead Price Forecast:

This week enters July, with the factor of downstream enterprises' year-end account closing and inventory checking resolved, the spot market may resume regular transactions. As lead prices rose, the losses of secondary lead narrowed last week. Coupled with the conclusion of environmental protection inspections in various regions, the willingness of secondary lead enterprises to resume production increased. The expected increase in supply may pose a risk of lead prices jumping initially and then pulling back.