The US dollar and crude oil pulled back, metals showed mixed performance, with SHFE tin, SHFE silver, platinum, and palladium leading the gains, while SHFE lead fell more than 1% [SMM Midday Review]

SMM July 27 News:

Metal Market:

At the midday break, domestic base metals were mixed. SHFE copper rose 0.31%, while SHFE aluminum edged lower. SHFE lead fell 1.11%. SHFE zinc rose 0.3%. SHFE tin rose 1.86%. SHFE nickel fell 0.42%.

In addition, the most-traded cast aluminum futures contract fell 0.13%, while the most-traded alumina contract rose 0.19%. Lithium carbonate’s most-traded contract rose 0.86%. Silicon metal’s most-traded contract rose 0.24%. Polysilicon’s most-traded futures contract rose 0.15%.

Ferrous metals mostly rose. Iron ore rose 0.27%, rebar rose 0.33%, and HRC rose 0.55%. Stainless steel fell 0.34%. For coking coal and coke: the most-traded coking coal contract fell 0.62%, and the most-traded coke contract rose 0.87%.

In overseas base metals, as of 11:40, LME metals showed mixed performance. LME copper rose 0.49%, while LME aluminum fell 0.27%. LME tin and LME zinc each rose within 0.5%. LME lead edged lower. LME nickel fell 0.32%.

In precious metals, as of 11:40, COMEX gold rose 0.42% and COMEX silver rose 1.1%. In the domestic market: SHFE gold rose 0.87%; the most-traded SHFE silver contract rose 2.97%.

In addition, at the midday break, the most-traded platinum futures contract rose 2.31%, and the most-traded palladium futures contract rose 2.22%.

At the midday break, the most-traded container shipping (European route) futures contract fell 3.02% to 2,750 points.

Selected futures midday prices as of 11:40, July 27:

Spot and Fundamentals

Silver: Trump suspended airstrikes on Iran, cooling geopolitical tensions temporarily; oil prices tumbled, and inflation and rate-hike expectations eased, while precious metals rebounded. The spot market sustained parity deals, with the weak supply-demand pattern persisting. …… 》Click for details

Macro Front

China:

[NBS: Profits of China's Industrial Enterprises Above Designated Size Rose 18.7% in 1H; Electronics-Related Sectors Posted Rapid Profit Growth] On July 27, the National Bureau of Statistics (NBS) released data showing that in H1, amid steady manufacturing growth and a continued rebound in industrial product prices, revenue of industrial enterprises above designated size rose 6.5% YoY, an acceleration of 1.5 percentage points from Q1. Accelerating revenue growth drove profits of industrial enterprises above designated size up 18.7% YoY, accelerating 3.2 percentage points from Q1. By major sector, mining and manufacturing profits grew 33.5% and 20.1%, respectively, accelerating 17.3 and 1.0 percentage points from Q1; electricity, heat, gas and water production and supply fell 4.2%. In June, profits at industrial enterprises above designated size rose 15.1% YoY. In H1, profits of the raw material manufacturing sector above designated size surged 71.7% YoY, boosting overall profits of industrial enterprises above designated size by 8.8 percentage points. By sector, driven by firm demand for nonferrous metals such as copper and aluminum, profits in the nonferrous metals sector jumped 99.4%, boosting overall industrial profits by 4.7 percentage points; driven by price increases of products along the petroleum industry chain, the petroleum processing sector swung from a loss to a profit YoY, while the chemical sector's profit rose 67.8% YoY.

The PBOC conducted 7-day reverse repo operations of 325.5 billion yuan today at an operation rate of 1.40%. Today, 398.5 billion yuan of reverse repos and 400 billion yuan of MLF matured.

US Dollar:

As of 11:40, the US dollar index fell 0.26 to 101.22. Markets widely expect the Fed to keep rates unchanged this week. According to CME FedWatch: The probability of the Fed keeping rates unchanged in July was 63.7%, and the probability of a cumulative 25bp hike was 36.3%. For September, the probability of keeping rates unchanged was 19.6%, the probability of a cumulative 25bp hike was 55.2%, and the probability of a cumulative 50bp hike was 25.2%.

Data:

Today, data including the German July IFO Business Climate Index, the UK July CBI Distributive Trades Survey balance, the US June durable goods orders MoM, and the US July Dallas Fed new orders index will be released.

Crude Oil:

As of 11:40, oil prices in both markets plunged sharply, with WTI down 4.97% and Brent down 3.93%. Geopolitical tensions between the US and Iran eased somewhat, and oil prices tumbled at the opening on Monday as traders assessed Middle East supply risks. As the US-Iran conflict spread from the Strait of Hormuz to the Red Sea, Brent crude surged about 30% this month, briefly breaching $100 per barrel last week. The conflict, now approaching the end of its fifth month, has intensified concerns about a global inflationary shock as the global fuel market has lost idle capacity amid war-driven price gains and as refined product prices jumped. (Jin10 Data APP)

Spot Market Overview:

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