Geopolitical and Macro Stimulus Repeatedly Intensified Market Sentiment and Fluctuations; Downstream Enterprises Mostly Stayed on the Sidelines [SMM Tin Midday Review]

On March 5, 2026, after probing higher in the morning, the most-traded SHFE tin contract saw its center pull back to around 405,000 yuan/mt, and closed at 406,790 yuan/mt at midday, up 2.89%. On the LME, three-month tin was temporarily quoted at $51,760/mt, up 1.09%. After a sharp drop, SHFE and LME entered a phase of consolidation. Against a backdrop of mixed macro sentiment between bulls and bears, tin futures have recently seen a marked increase in intraday volatility.

From a macro perspective, US PMI data in early 2026 showed expansion in both manufacturing and services. In February, the US ISM services PMI rose to 56.1, a more-than-three-year high, with strong growth in business activity and new orders and accelerating employment growth. The ISM manufacturing PMI came in at 52.4, slightly below January’s 52.6 but still in expansion territory; however, price pressures intensified, with the February manufacturing price index reaching its highest level since June 2022, reflecting higher import tariffs and rising raw material prices. The combination of an expanding economic backdrop and rising price pressures shifted market expectations for the US Fed’s interest rate cut path, providing some near-term support for the US dollar index. The US dollar’s relative resilience may, to some extent, weigh on valuations of US dollar-denominated commodities; on the other hand, a high-inflation environment has also spurred global capital to seek allocations to inflation-hedging assets. This macro liquidity expectation has directly led to repeated tug-of-war in investment flows in the current commodities market.

Fundamentals, as the most-traded contract moved back above the 400,000 yuan/mt threshold, downstream enterprises’ willingness to purchase cooled notably. Compared with the active trading atmosphere earlier this week, when restocking was concentrated on dips, the spot market has now returned to a wait-and-see stance due to the lack of directional guidance from futures. The drawdown of 400 mt in exchange inventory yesterday also indirectly confirmed the market’s underlying capacity to absorb supply during the prior price pullback.

Overall, near-term market performance remains heavily driven by macro-driven sentiment and capital flows. With prices holding above 400,000 yuan, the tug-of-war between bulls and bears has kept the trading range wide. Tin prices are expected to maintain a fluctuating trend in the near term. Going forward, attention should remain on the impact of the overseas Middle East situation on global resources, as well as the digestion of actual demand across the tin industry chain.