Overnight, LME lead remained in the doldrums, while SHFE lead attempted to stop falling and stabilize [SMM Lead Morning News]

SMM January 27:

Overnight, LME lead opened at $2,035.5/mt. During the Asian session, it fluctuated considerably along the daily average line. Upon entering the European session, after a brief consolidation, influenced by increased short positions, LME lead fluctuated downward, touching a low of $2,009/mt. It saw a slight rebound late in the session, with the latter half of the trend forming a "V" shape. It finally closed at $2,028/mt, down $8/mt, a change of 0.39%. This ended a three-day winning streak, recording a small bearish candlestick with a long lower shadow.

Overnight, the most-traded SHFE lead 2603 contract opened at 17,000 yuan/mt. After a slight rise to around 17,070 yuan/mt at the beginning of the session, a large amount of short funds poured in, causing SHFE lead to fall sharply, reaching a low of 16,915 yuan/mt. It recovered all losses by the end of the session, finally closing at 17,000 yuan/mt, with a % change of 0.00%. This ended a three-day losing streak, forming a doji, with the KDJ line gap narrowing and showing signs of closing.

Downstream battery producers have gradually started stockpiling, but generally expect lead smelters to further widen their discounts. Supply side shows divergence: some primary lead suppliers, facing significant inventory pressure, have chosen to widen discounts to promote transactions; while secondary lead suppliers find it difficult to widen their discount margins due to loss pressures. Demand side, due to weak end-use consumption, the overall restocking scale by downstream battery producers is limited. Overall, the current market shows oversupply, and lead prices are expected to continue fluctuating at lows in the short term.

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