Crude Oil Gains for Fourth Straight Day, Metals: Domestic Market Outperforms Overseas, SHFE Zinc Up Nearly 1%, Alumina Down Nearly 2%, Gold, Silver Both Rise [Overnight Market]

SMM, July 23:

Metals market:

Overnight, domestic base metals generally rose. SHFE copper fell 0.16%, SHFE aluminum gained 0.35%, SHFE lead gained 0.54%, SHFE zinc gained 0.98%, and SHFE tin fell 0.23%. SHFE nickel rose 0.62%. Additionally, the most-traded alumina futures contract fell 1.72%, and the most-traded casting aluminum contract gained 0.28%.

Overnight, ferrous metals all rose. Stainless steel edged up 0.2%, iron ore gained 0.34%, rebar rose 0.16%, and HRC edged up. Coking coal and coke: the most-traded coking coal contract added 0.51%, and the most-traded coke contract edged up 0.08%.

Overnight overseas, LME base metals mostly moved sideways. LME copper edged down 0.04%. LME aluminum was flat at $3,192.5/mt. LME lead fell 0.18%. LME zinc fell 0.15%. LME tin rose 0.39%. LME nickel fell 0.53%.

Overnight precious metals : COMEX gold rose 1.44%, and COMEX silver rose 1.57%. Overnight, the most-traded SHFE gold contract gained 1.16%, and the most-traded SHFE silver contract gained 1.69%.

As of 7:07 am July 23, overnight closing prices:

Macro front

China:

[National Energy Administration: As of end-June, national cumulative installed power generation capacity reached 4.04 billion kW, up 10.8% YoY] On July 22, the National Energy Administration released national electricity statistics for the January-June period. As of end-June, total installed power generation capacity reached 4.04 billion kW, up 10.8% YoY. Solar power capacity was 1.27 billion kW, up 15.8% YoY; wind power capacity was 680 million kW, up 18.5% YoY.

[CSRC: steadily expand high-level institutional opening and continuously improve the convenience for foreign investors in the capital market] On July 21, Wu Qing, Chairman of the China Securities Regulatory Commission (CSRC), met in Beijing with John Graham, President and CEO of Canada Pension Plan Investment Board. The two sides exchanged views on global and China economic and financial trends, investing in China’s capital market, and other topics. Wu Qing noted that against a complex and shifting international landscape, China’s economy performed generally stable in H1, maintaining a positive and improving trend and demonstrating resilience and vitality. The CSRC will pursue progress while ensuring stability, resolutely safeguard the sound and stable operation of the capital market, steadily expand high-level institutional opening, and continuously improve the convenience for foreign investors in the capital market. We welcome international institutional investors, including the Canada Pension Plan Investment Board (CPP Investments), to expand their investments in China and share in the dividends of China’s economic and capital market reform and development. Graham stated that CPP Investments, as a long-term investor with a global footprint, pays close attention to and remains optimistic about the effectiveness of China’s economic reform and development, has long regarded China as one of its key investment regions globally, and will continue to practice its value investing philosophy by actively deploying investments in China.

[Beijing State-owned Capital Operation and Management Co., Ltd. (BSCOMC): To date, it has allocated nearly 10 billion yuan of its own funds to the stock market.] On July 22, Beijing State-owned Capital Operation and Management Co., Ltd. (BSCOMC) announced that, to date, BSCOMC had allocated nearly 10 billion yuan of its own funds to the stock market. Going forward, BSCOMC will rely on its own funds and its securities companies and public fund subsidiaries to continue increasing its holdings of listed companies’ stocks, support the development of the Beijing Stock Exchange, and, in line with its functional positioning as a state-owned capital operation company, resolutely safeguard the strategic value of listed companies’ core assets, thereby contributing the strength of Beijing’s state-owned enterprises to the stable and healthy development of the capital market.

On the US dollar front:

Overnight, the US dollar index fell 0.09% to 101.12. US military strikes on Iran entered their 11th day, oil prices spiked to a six-week high, inflation expectations heated up in response, and the possibility of a Fed rate hike in July resurfaced. (Wallstreetcn)

According to CME FedWatch: The probability of the Fed keeping rates unchanged in July is 65.3%, while the probability of a cumulative 25bp rate hike is 34.7%. By September, the probability of unchanged rates is 22%, a cumulative 25bp hike is 54.9%, and a cumulative 50bp hike is 23%. (Jin10 Data APP)

Joseph Lavorgna, chief US economist at Sumitomo Mitsui Banking Corporation (SMBC), stated that if inflation does not slow, policymakers will lose their hard-won credibility. In a report, Lavorgna noted that over the past 70 years, there have been only six instances where core inflation fell by 0.9% or more year-over-year. In each case, the slowdown in inflation occurred because the Fed was tightening policy. Lavorgna said, “The longer the Fed waits, the greater the likelihood that interest rates will have to rise above the level necessary. That’s why so many past tightening cycles ended in tragedy. Chair Warsh understands this.” (Jin10 Data APP)

On the macro front:

Today, data due to be released include China’s June RMB share in Swift global payments, Australia’s June seasonally adjusted unemployment rate, the UK’s July CBI industrial order book balance, the Eurozone’s deposit facility rate as of July 23, the Eurozone’s main refinancing rate as of July 23, Canada’s May retail sales month-over-month, US initial jobless claims for the week ending July 18, and the Eurozone’s July consumer confidence flash estimate. Also note: The ECB will announce its interest rate decision; ECB President Lagarde will hold a monetary policy press conference; Google and Tesla Q2 earnings reports were released after the US stock market close on July 22.

Crude oil:

Overnight, both crude oil futures extended gains for the third straight session, with WTI up 2.54% and Brent up 4.93%. The escalating Middle East conflict and market fears of supply disruptions supported oil prices.

According to Iran's Tasnim News Agency, the Khatam al-Anbiya Central Command issued a statement saying the Strait of Hormuz remains closed. Any vessel needing to pass through the strait must use designated routes and follow previously announced transit arrangements. The statement noted that if the US follows through on its threats, Iran will cut off all oil flows in the Gulf region and strike oil, gas, electricity, and economic infrastructure there. The statement also said repeated US threats will only lead to the expansion of war in the region and beyond. (Jin10 Data APP)

US domestic crude oil production for the week ending July 17 recorded its largest decline since the week ending January 30, 2026. US EIA Strategic Petroleum Reserve inventories for the week ending July 17 dropped to their lowest since the week ending March 25, 1983. EIA report: Commercial crude oil inventories excluding strategic reserves increased by 2.01 million barrels to 412 million barrels, up 0.49%. (Jin10 Data APP)

US refiners are raising diesel output to near record levels, reversing the seasonal trend. According to the US Department of Energy, refineries have averaged 5.3 million barrels per day of refined fuel oil (of which diesel is the main component) this month. If sustained, this would be the highest diesel production for July on record in the US and one of the highest months outside the winter heating season. Typically, diesel production peaks near year-end, but this year, due to severe global supply tightness, refiners have ramped up output months ahead of schedule. (Jin10 Data APP)