Supported by multiple bullish factors, copper prices fluctuated upward overnight [SMM Copper Morning Comment]

SMM reported on July 16: Overnight, LME copper opened at $9,635.5/mt, fluctuated downward in the early session to a low of $9,598/mt, then fluctuated upward throughout the session, reaching a high of $9,657.5/mt near the close, and finally closed at $9,657.5/mt, up 0.15%. Trading volume reached 15,000 lots, and open interest reached 279,000 lots. Overnight, the most-traded SHFE copper 2508 contract opened at 77,960 yuan/mt, fluctuated downward in the early session to a low of 77,810 yuan/mt, then fluctuated upward, reaching a high of 78,160 yuan/mt near the close, before pulling back slightly to close at 78,070 yuan/mt, up 0.18%. Trading volume reached 21,000 lots, and open interest reached 168,000 lots. On the macro front, the US CPI in June recorded the largest MoM increase in five months, and tariffs may be fueling inflation. However, overall, the US faces the risk of stagflation, which will weigh on the US dollar and support copper prices. Additionally, as Trump's sanctions on Russia come with a 50-day buffer period, easing market concerns about any immediate supply disruptions, oil prices continued to decline. But OPEC stated that oil demand would remain "very strong" in Q3, supporting copper prices. On the fundamental front, there was certain pressure on the supply side. The day marked the last trading day for the SHFE copper 2507 contract, and suppliers were fatigued from quoting prices, with the overall supply rhythm fluctuating due to contract rollover. Demand side, downstream consumption sentiment was poor recently. Even though suppliers adjusted their premium quotes, it failed to effectively boost trading volume. On the price front, the US Treasury Secretary indicated that China-US negotiations were in a "good state," urging continued attention to tariff developments. It is expected that copper prices will still have certain upside room today.