Bulls push LME lead higher, overnight probe above $1,900/mt [SMM Lead Morning Brief]

SMM, July 8:

Overnight, LME lead opened at $1,882.5/mt, drifted lower during the Asian session to a low of $1,875/mt and then rebounded; entering the European session, bulls gained strength, LME lead surged, touching a high of $1,904.5/mt in late trading, and finally settled at $1,887.5/mt, up 0.35%.

Overnight, the most-traded SHFE lead 2608 contract opened higher with a gap at 15,940 yuan/mt, briefly touched a low of 15,930 yuan/mt in early trading, boosted by LME lead's rise, SHFE lead rose to 16,110 yuan/mt; due to weak fundamentals, it gave back part of its gains in late trading, and finally settled at 16,030 yuan/mt, up 0.79%.

Demand side, the off-season trend in July remained unchanged, while large enterprises resumed regular procurement after the half-year stocktaking and account closing factors were removed, bringing certain procurement expectations. Supply side, primary lead enterprises are about to resume production after maintenance, supply is expected to turn higher, while secondary lead enterprises are in a state of production cuts, leading to regional supply constraints. Overall, lead prices are expected to remain in the doldrums in the short term.