BC Copper 0.002509 Dips Intraday, Closing Lower [SMM BC Copper Commentary]

Today, the most-traded BC copper 2509 contract opened at 69,710 yuan/mt and closed lower during the day. In the night session, BC copper fluctuated rangebound, dropping to an intraday low of 69,560 yuan/mt. As bears reduced positions, the futures center rebounded, reaching a high of 69,880 yuan/mt. During the morning trading session, the futures moved sideways, and in the afternoon, the center gradually declined, closing at 69,620 yuan/mt, down 60 yuan/mt or 0.09%. Open interest reached 4,122 lots, an increase of 100 lots from the previous trading day, while trading volume was 2,551 lots, a decrease of 275 lots. On the macro front, policy divergence within the US Fed has become apparent. Although the July meeting kept rates unchanged, a few officials now support an interest rate cut in September. Expectations for US Fed interest rate cuts have strengthened, providing supportive sentiment for copper prices. Meanwhile, Israel has not yet responded to the ceasefire proposal, and military operations continue. Russia also strongly opposes NATO troops in Ukraine, with geopolitical risks persisting and market sentiment remaining cautious. Today, attention can be given to changes in the US dollar index following the release of the initial jobless claims data for the week ending August 16. On the fundamentals side, on the supply end, LME inventories remained flat at 156,350 mt. As of August 21, SMM national mainstream region copper inventories increased by 6,100 mt to 120,300 mt compared to the previous Thursday. On the demand side, after premiums were lowered, downstream purchasing sentiment improved.

The SHFE copper 2509 contract closed at 78,540 yuan/mt. If the BC copper 2509 contract is at 69,620 yuan/mt, its post-tax price would be 78,671 yuan/mt. The price spread between the SHFE copper 2509 contract and the BC copper 2509 contract is -131, with the spread remaining inverted but narrowing from the previous day.