Copper prices closed slightly higher amid overnight fluctuations, supported by both macro and fundamental factors [SMM Morning Comment on Copper]

       SMM News on July 11: Overnight, LME copper opened at $9,718/mt, reaching a high of $9,744/mt shortly after the opening. Subsequently, the center of copper prices gradually moved downward, exhibiting a pattern of considerable fluctuations. Near the end of the trading session, it dropped to $9,681.5/mt and finally closed at $9,682/mt, with a gain of 0.23%. Trading volume reached 18,000 lots, and open interest stood at 280,000 lots. Overnight, the most-traded SHFE copper 2508 contract opened at 78,700 yuan/mt, touching a high of 78,810 yuan/mt shortly after the opening. Subsequently, the center of copper prices gradually pulled back, dropping to 78,510 yuan/mt, and then fluctuated considerably. Near the end of the trading session, it again touched a low of 78,510 yuan/mt and finally closed at 78,590 yuan/mt, with a gain of 0.26%. Trading volume reached 26,000 lots, and open interest stood at 178,000 lots. On the macro front, firstly, San Francisco Fed President Mary Daly reiterated the consideration of initiating an interest rate cut in the autumn and expected two interest rate cuts within the year, continuously strengthening market expectations for a shift towards a looser monetary policy by the US Fed. Secondly, Chile, a major copper-producing country, is seeking exemption from US copper tariffs. If Chile successfully obtains tariff exemption, it will effectively alleviate market concerns arising from potential high tariffs in the early stage. Currently, no significant new variables have emerged on the macro perspective, and the market's core concerns are highly focused on whether the 50% tariff on copper will ultimately be implemented. On the fundamental side, supply-side, as the contract rollover approaches, suppliers' willingness to sell has increased, and the supply of market-available copper is relatively loose. Demand side, due to the copper price pullback in the previous two days, downstream procurement sentiment has slightly recovered. As of Thursday, July 10, SMM's nationwide mainstream copper inventories increased slightly by 800 mt from Monday to 143,700 mt, an increase of 11,900 mt from Thursday last week. Weekly inventories have built up for two consecutive weeks and are currently 244,900 mt lower than the 388,600 mt of the same period last year. On the price front, there are no new driving factors on the macro perspective. Despite consecutive inventory buildups on the fundamental side, inventories remain at a low level, providing support for copper prices below.