BC copper closed up 2.01%, with strong macro expectations supporting copper prices [SMM BC Copper Commentary]

Today, the most-traded BC copper 2508 contract opened at 69,680 yuan/mt, closing the day with a positive candlestick, indicating a reduction in bearish positions. During the night session, the most-traded BC copper contract touched a low of 69,680 yuan/mt at the opening, followed by a continuous upward movement in the copper price center. After the day session opened, the copper price center continued to rise, approaching the end of the trading day, it surged to 70,910 yuan/mt, and finally closed at 70,890 yuan/mt, with a gain of 2.01%. The open interest reached 4,198 lots, a decrease of 21 lots from the previous trading day, and the trading volume reached 7,592 lots. From a macro perspective, Bessent continued to dissuade Trump from dismissing Powell, but Trump insisted that he did not need others to explain Powell's pros and cons. Waller was vague about his stance on the July meeting but expressed willingness to take over the US Fed if nominated by the President. Meanwhile, domestically, the Ministry of Industry and Information Technology (MIIT) will issue a new round of plans to stabilize the growth of non-ferrous metals, promoting high-quality development of the copper, aluminum, and gold industries, providing bottom support for copper prices. On the fundamental side, this week, both imported and domestically produced copper arrivals were low, coupled with a significant amount of downstream cargo pick-up, resulting in good outflows from warehouses. As of Monday, July 21st, SMM's nationwide copper inventories in major regions fell to 118,600 mt. On the demand side, after the current halt in the copper price decline and subsequent rebound, downstream procurement sentiment has gradually weakened, leading to a situation of weak supply and demand. Under strong policy expectations at the macro level, market sentiment has been boosted, providing support for copper prices from below.

The most-traded SHFE copper 2509 contract closed at 79,700 yuan/mt. If based on the most-traded BC copper 2508 contract price of 70,890 yuan/mt, its after-tax price is 80,106 yuan/mt. The price spread between the SHFE copper 2509 contract and the BC copper contract is -406, maintaining an inverted spread and widening compared to the previous day.