After the non-farm payrolls data release, the US dollar index rose, putting pressure on copper prices; focus on today's domestic press conference [SMM Copper Morning Comment]

Published: Oct 8, 2024 09:53
Source: SMM
Overnight, LME copper opened at $9,949/mt, initially rose to a high of $9,981/mt, then fluctuated downward to a low of $9,860/mt before climbing to a high of $9,965/mt at the close, and finally settled at $9,952/mt.

Overnight, LME copper opened at $9,949/mt, initially rose to a high of $9,981/mt, then fluctuated downward to a low of $9,860/mt before climbing to a high of $9,965/mt at the close, and finally settled at $9,952/mt. Trading volume reached 12,000 lots, and open interest reached 300,000 lots. SHFE copper market was closed overnight. Macro side, after the non-farm payrolls data release, the likelihood of a 50 basis point interest rate cut by the US Fed this year decreased. US Fed officials indicated a greater possibility of further rate cuts, but traders expect less than a 50 basis point cut this year. The US dollar index rose significantly, suppressing copper prices. Additionally, sources indicated that Israel would soon retaliate against Iran, and Iran's Tasnim News Agency stated that Iran has prepared 10 plans to respond to potential Israeli attacks, further escalating tensions in the Middle East. Meanwhile, domestically, attention is on today's press conference by the National Development and Reform Commission. Fundamentally, on the last trading day before the holiday, downstream had mostly completed restocking, spot trading was sluggish, and with high copper prices, premiums fell. Copper cathode inventory began to build up again. The market is now focused on post-holiday developments, with expectations of a slight inventory build-up after the National Day holiday, and premiums are expected to be more likely to fall than rise. As of Monday, September 30, SMM copper stocks in major regions increased by 11,200 mt to 165,500 mt compared to last Thursday, ending the continuous destocking trend and increasing again. Overall, with accelerated growth in the US in September and a rising US dollar index, copper prices are under pressure. Although domestic consumption is restrained by copper prices, the market remains optimistic about domestic demand prospects due to multiple favorable policies, providing bottom support for copper prices. Copper prices are expected to remain high today. Notably, at 10 a.m. today, the State Council Information Office will hold a press conference, where the director and deputy director of the National Development and Reform Commission will introduce the implementation of a package of incremental policies.

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