LME Lead Center Shifts Lower, SHFE Lead Weakens Under Pressure from Inventory Buildup [SMM Lead Morning Update]

SMM, August 14:

Overnight, LME lead opened at $1,907/mt. During Asian trading hours, LME lead trading was sluggish, and it moved sideways for most of the time in the $1,905-1,910/mt range. After entering European trading hours, the decline in LME lead widened. In particular, during the night session its trading center continued to move lower. It fell to a low near the middle Bollinger Band and found support there, eventually closing at $1,890/mt, down 0.6%.

Overnight, the most-traded SHFE lead 2609 contract opened at 15,890 yuan/mt. Affected by lead ingot inventory buildup, SHFE lead drifted lower after the open, successively breaking below the 5-day and 40-day moving averages and falling below 15,850 yuan/mt, before finally closing at 15,835 yuan/mt, down 0.81%; open interest was 41,327 lots, down 196 lots from the previous trading day. In addition, open interest in the SHFE lead 2609 contract continued to shift to the SHFE lead 2610 contract recently. Currently, open interest in the SHFE lead 2610 contract is 73,855 lots. Attention should be paid to the subsequent rollover of the most-traded contract.