Lead prices maintain fluctuating trend amid strong wait-and-see sentiment [SMM Lead Morning Meeting Summary]

Futures Market:

Overnight, LME lead opened at $1,974/mt. During the Asian session, it consolidated in a range. Entering the European session, it briefly touched a high of $1,977.5/mt before diving, reaching a low of $1,956/mt in the tail end of the session, and finally closing at $1,963.5/mt, down 0.53%. Overnight, the most-traded SHFE lead 2509 contract opened at 16,750 yuan/mt. After briefly touching a high of 16,760 yuan/mt in the early session, it fluctuated downward, reaching a low of 16,650 yuan/mt in the tail end, and finally closing at 16,660 yuan/mt, down 0.72%.

》Click to view historical SMM lead spot quotes

The EU will suspend its trade retaliation measures against the US for six months. The EU is waiting for Trump to take action on car tariffs and exemptions this week. Fed's Daly: The time for interest rate cuts is approaching, and it is more likely that there will be more than two interest rate cuts this year.

The Hong Kong Monetary Authority bought HKD 6.429 billion in the market as the Hong Kong dollar exchange rate touched the weak-side conversion guarantee. China Machinery Industry Federation: Recently, the MIIT is expected to issue work plans for stabilizing growth in industries such as machinery, automobiles, and power equipment. In the first half of this year, the market penetration rate of NEVs reached 44.3%, a record high for the same period. China Passenger Car Association: In July, nationwide wholesale sales of passenger NEVs by producers reached 1.18 million units, up 25% YoY and down 4% MoM.

Spot Fundamentals

SHFE lead stopped falling and rebounded. Suppliers' enthusiasm for selling was moderate. In the Jiangsu, Zhejiang, and Shanghai regions, the discounts in quotations were not significantly different. In the main producing areas of primary lead, the discounts in quotations expanded compared to last Friday, with discounts of 130-80 yuan/mt against the SHFE lead 2509 contract. For secondary lead, some secondary lead enterprises resumed quoting and selling, but their quotations were relatively firm. The quotations for secondary refined lead were at premiums of 0-100 yuan/mt against the SMM #1 lead average price ex-factory. However, downstream enterprises' enthusiasm declined, with fewer inquiries compared to last week and more price negotiations. The activity in the spot order market decreased.

Inventory:

On August 4, LME lead inventory decreased by 1,100 mt to 274,225 mt. As of August 4, the total social inventory of SMM lead ingots in five locations reached 71,900 mt, a decrease of about 1,000 mt from July 31.

Today's Lead Price Forecast:

Lead prices are expected to fluctuate and rebound. Losses in secondary lead production have narrowed, and some secondary lead enterprises have resumed selling. However, most suppliers are maintaining firm quotations, and their supplies do not have a price advantage. Additionally, primary lead enterprises that underwent maintenance earlier have resumed production recently. The supply of spot orders in the short term has not shown significant changes, and the market sentiment is characterized by wait-and-see. Some downstream enterprises are negotiating prices to purchase, and transactions are relatively light. Given stable macro sentiment, it is expected that lead prices will maintain a fluctuating trend today.

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market exchanges, and relying on SMM's internal database models. These data are for reference only and do not constitute decision-making advice.