During the holiday, LME prices surged, and after the holiday, they hit new highs again. Pay attention to the risk of a pullback next week. [SMM Macro Weekly Review]

During the 2025 National Day holiday, COMEX led the gains in copper prices. The London copper market continued its pre-holiday strong trend, hitting a new phase high during the holiday. It closed at $10,701/mt on October 8, and surged to a high of $10,100/mt on the evening of October 9, before slightly retreating. From a macro perspective, the US September employment and inflation data released during the holiday were significantly below market expectations. Coupled with the slowdown in the PCE price index, this further strengthened the market's view that the US Fed's tightening cycle has ended or that an interest rate cut may come earlier. As a result, US Treasury yields fell sharply, providing systematic support for commodity prices, including copper. A weaker US dollar reduced the relative cost of dollar-denominated metal prices, attracting more funds into the commodity market, which became a key catalyst for the sharp rise in copper prices during the holiday. Observing that gold and silver continued to hit new highs during the holiday, boosting copper market sentiment, attention should be paid to potential corrections in precious metals for guidance on copper prices.

On the fundamentals side, the copper concentrate market showed no improvement, with forward tender prices gradually emerging. A Japanese smelter reduced copper production. After the holiday, both domestic and foreign trade markets were inactive. Domestic trade was dominated by just-in-time procurement, with purchasing sentiment significantly lower than before the holiday. In foreign trade, traders actively sought COMEX-registered supplies, and B/Ls for related brands were quickly snapped up. Looking ahead to next week, if copper prices remain high, spot market sentiment is expected to struggle to improve. Multiple countries will release CPI data next week, with focus on the US unadjusted annual CPI rate for September and the US monthly retail sales figure for September. If the market revises down expectations for an October interest rate cut, risk assets may see a slight correction. SHFE copper is forecast to trade between 84,000-88,500 yuan/mt, while LME copper is expected to range between $10,500-10,900/mt. SHFE copper premiums and discounts are projected to range from a discount of 80 yuan/mt to a premium of 150 yuan/mt.