SMM Morning Comments (Mar 2)

SHANGHAI, Mar 2 (SMM) -

Copper: LME copper fell to a low of $6,858.5/mt last night while SHFE copper closed at 52,520 yuan/mt. We expect LME copper to trade at $6,850-6,920/mt today with the SHFE 1805 contract at 52,300-52,800 yuan/mt. Spot discounts are seen widening to 210-130 yuan/mt as sellers were keen to destock.

Aluminium: LME aluminium rebounded and hit a high at $2,164.5/mt as US President Donald Trump said that the country is to impose a 10% global tariff on aluminium. SHFE aluminium inched up to close at 14,520 yuan/mt. We expect the SHFE aluminium 1805 contract to trade at 14,400-14,580 yuan/mt today but with pressure at 14,550 yuan/mt. Spot discounts are seen at 160-120 yuan/mt.

Zinc: LME zinc lost support at the 60-day moving average overnight while we see it trade at $3,385-3,435/mt today. SHFE zinc is expected to trade at 26,000-26,400 yuan/mt amid a relatively bullish sentiment.

Nickel: As stronger US dollar continued to give pressure to base metals, LME nickel dropped overnight and we expect it to go lower with increasing stainless steel inventory. The SHFE 1805 contract is set to trade at 101,200-103,000 yuan/mt today with spot prices at 100,500-102,200 yuan/mt.

Lead: With a slump in LME lead, the SHFE 1804 contract closed lower at 18,850 yuan/mt overnight. We expect it to stay rangebound with support at the 18,700 yuan/mt level today.

Tin: LME tin remained rangebound with support at $21,000/mt and resistance at $22,000/mt overnight, while SHFE tin moved around the 40-day moving average. We expect SHFE tin to trade at 146,000-148,000 yuan/mt with pressure today.

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