[SMM Analysis] This week, the market was influenced by a mix of bullish and bearish factors, and nickel prices fluctuated downward.

This week, the market was influenced by a mix of bullish and bearish factors, with recovering macro sentiment and persistently accumulating inventory pressure jointly driving nickel prices to fluctuate downward. The most-traded SHFE nickel contract opened the week at 122,150 yuan/mt, then came under pressure and pulled back, closing at 120,590 yuan/mt on Friday, down 1.14% for the week. LME nickel prices started the week at $15,370/mt, edged up slightly early in the week due to improved overseas macro sentiment, but later pulled back under fundamental pressure, with the latest quote at $15,200/mt, down 0.85%. In the spot market, the average price of SMM #1 refined nickel this week was 122,250 yuan/mt, down 950 yuan/mt WoW. The average premium for Jinchuan nickel this week was 2,400 yuan/mt, down 100 yuan/mt WoW. The premiums and discounts for mainstream domestic brands of electrodeposited nickel ranged from -200 to 100 yuan/mt, weakening WoW. As futures prices remained low this week, downstream point-price purchasing sentiment was relatively high.

On the macro front, the US Fed cut interest rates by 25 basis points as expected, but Chairman Powell clearly stated that a December rate cut is not a "done deal" and pointed out significant divisions within the committee. This hawkish tone caused market expectations for another rate cut within the year to plummet from 95% to 65%, triggering a brief rebound in the US dollar index. Uncertainty surrounding the policy path suppressed bullish sentiment, limiting the rebound in nickel prices. The outcomes of the meeting between the Chinese and US heads of state on October 30 were relatively positive. The US canceled the 10% "fentanyl tariff" imposed on Chinese goods and suspended the 24% reciprocal tariff for another year. Simultaneously, the US will suspend its Section 301 investigation measures targeting China's maritime, logistics, and shipbuilding industries for one year. This progress alleviated market concerns about an escalation in trade friction. However, LME nickel inventory continued to climb to 251,706 mt, hitting a new record high. Nickel prices are expected to see their fluctuation range shift downward in the near future, with a reference price of 119,000-123,000 yuan/mt.

Inventory side, Shanghai Bonded Zone inventory was about 2,600 mt this week, down 800 mt WoW.

Domestic social inventory was about 48,100 mt, destocking 698 mt WoW.