SMM Morning Review - 2010/1/28 Lead Market

SHANGHAI, Jan. 28 (SMM) -- On January 27th, LME lead prices plunged USD 106/mt to close at USD 2,094/mt. On the same day, the Ministry of Commerce announced sales of newly-built US single-family homes in December fell 7.6% from November levels to a seasonally adjusted annual rate of 342,000. The high unemployment rate dashed out the hope of recovery in the property market. Meanwhile, the US Federal Reserve decided to leave the interest rate in the 0-0.25% range, and pledged to keep the low rate for some time, so as to help the recovery of the economy. Yesterday, S&P lowered Japan's credit rating, helping the US dollar strengthen, and base metal markets suffered pressure as a result. LME lead inventories continue to grow, with stocks on January 27th up 1,725 mt to 155,775 mt.

SMM continues to take a pessimistic view towards lead prices, with levels estimated in the USD 2,000-2,100/mt range.

To contact the writer on this report: Sherryshi@smm.cn

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