[July 22 SMM lead internal morning meeting record]

Summary of the lead morning meeting:

Macro:

Recently, the US side announced that it would waive tariffs on 110 items of Chinese industrial products exported to the United States, and expressed its willingness to promote US enterprises to continue to supply relevant Chinese enterprises; in order to meet the needs of Chinese consumers, the Chinese enterprises concerned intend to continue to import some agricultural products from the United States that meet the needs of the domestic market. The relevant Chinese authorities expressed the hope that the United States and the Chinese side will go opposite each other and earnestly implement the relevant commitments of the United States.

The initial value of the University of Michigan's consumer confidence index rose slightly to 98.4 in July from 98.2 in June, close to its best level in more than a decade, and its financial position is expected to be the best since 2004.

The Office of the Financial Stability and Development Council of the State Council has introduced 11 measures to open up the financial industry to the outside world, including allowing foreign institutions to rate all types of bonds in the interbank bond market and the exchange bond market when carrying out credit rating business in China; allowing foreign institutions to obtain category A main underwriting licences for the interbank bond market; and further facilitating foreign institutional investors to invest in the interbank bond market;

460 billion yuan of reverse repo funds will expire this week and 502 billion yuan of MLF funds will expire on Tuesday; as a result, 962 billion yuan of funds will expire this week, and the central bank is expected to carry out an excessive continuation in the "MLF+TMLF" portfolio.

Fundamentals:

Last week spot lead price shock rose, due to the terminal consumption downturn, storage fear of high careful mining, market transaction dismal; primary lead, refineries follow the pace of lead price rise, actively adjust discount shipment, as of Friday, refinery bulk order mainstream quotation to SMM1# lead price discount 150 yuan / ton to 50 yuan / ton; Trade market holders are also actively quoting and shipping, but because the spot absolute price is higher, the transaction situation is extremely depressed, as of Friday, the mainstream quotation of domestic lead ordinary brand to 1908 contract discount 50 yuan / ton to Pingshui; In the aspect of recycled lead, with the fluctuation of lead price, the production profit of refinery is repaired. As of Friday, the mainstream quotation of recycled refined lead is 200yuan / ton to 300yuan / ton of SMM1# lead average price, and 350yuan / ton of discount to individual enterprises.

Last week, the total social inventory of lead ingots in the five places rose by nearly 1700 tons to 39500 tons.

Lead price:

Lun lead newspaper long film line, short-term or into the callback, but because the upward trend has begun, the range of return is limited, below to see whether there is support for $2000; Shanghai lead this round of the market is expected to come to an end, short see long exhausted, under the weak fundamentals, do not rule out the downward pressure on lead prices, at the same time, long positions are mostly speculative, this momentum does not rule out wait-and-see, in the near future need to be vigilant against the early increase of Shanghai lead;

The price of SMM1# lead is expected to be flat to 50 yuan per ton today.