SMM News, May 30:
Metals market:
Overnight, base metals fell collectively in both domestic and overseas markets. LME copper and LME tin both led the decline with a 0.98% drop. SHFE zinc fell 0.86%, while the remaining metals saw relatively small fluctuations in their declines. The alumina front-month contract closed flat at 2,888 yuan/mt, and the foundry aluminum front-month contract fell 0.26%.
Overnight, ferrous metals showed mixed performance. Stainless steel fell 0.74%, and iron ore fell 0.26%. Hot-rolled coil and rebar both rose around 0.2%. For coking coal and coke, coking coal rose 0.7% and coke rose 0.89%.
Precious metals: Overnight COMEX gold rose 0.83%, up 1.03% on the week, but down 1.29% on the month, marking a third consecutive monthly decline. COMEX silver fell 0.43% overnight, down 0.81% on the week, and up 2.1% on the month. Domestically, SHFE gold rose 1.61%, down 0.23% on the week and down 1.61% on the month, recording a third consecutive monthly decline alongside the overseas market. SHFE silver rose 0.64% overnight, down 1.23% on the week, and up 3.08% on the month.
As of 8:25 AM on May 30, overnight closing prices:
Macro Front
China:
From January to April, total operating revenue of national state-owned and state-holding enterprises fell 0.5% YoY, while total profits rose 1.9% YoY. Specifically, total operating revenue was 26.27 trillion yuan, and total profits were 1.37 trillion yuan. Taxes payable rose 3.9% YoY to 2.12 trillion yuan. At the end of April, the asset-liability ratio of state-owned enterprises was 65.5%, up 0.4 percentage points YoY. (Xinhua News Agency)
On May 29, in Q1 this year, China's integrated circuit exports reached $72.47 billion, up 77.5% YoY, of which memory product exports reached $45.99 billion, up 174.2% YoY. The surge in memory product exports also transmitted to supply chain service segments. A logistics enterprise executive said that since the beginning of this year, the company's orders related to memory exports doubled, with large orders exceeding 100 million yuan per transaction increasing significantly. Industry insiders noted that the explosive growth in memory product exports was driven by both cyclical factors of tight global supply and demand, and structural industrial changes including industry chain upgrades and market share gains in China's domestic memory sector. The Deputy Secretary General of the Shenzhen Electronics Chamber of Commerce said that compared to March last year, memory prices had risen nearly tenfold, with some even seeing more than tenfold increases. This was mainly because the significant price increases drove up the total (export) value. Domestic brand prices had a large price spread compared to ex-China brands, making them very competitive in terms of pricing. (CCTV Finance)
[MIIT and Seven Departments: Encouraging Equipment Manufacturing in Aerospace, Shipbuilding, Automotive, Robotics and Other Sectors]On May 29, the General Office of the Ministry of Culture and Tourism, the General Office of the Central Publicity Department, the General Office of MIIT, the General Office of the Ministry of Education, the General Office of the State-owned Assets Supervision and Administration Commission of the State Council, the Office of the National Cultural Heritage Administration, and the General Office of the All-China Federation of Trade Unions issued a notice on promoting industrial culture, protecting industrial heritage, and developing industrial tourism. The notice mentioned enriching industrial tourism product supply. It encouraged actively developing industrial heritage tourism, promoting the revitalization of industrial sites through creative design, new business format integration, and facade renovation, and developing new scenarios, formats, and models for industrial tourism. It strongly promoted "factory tours," encouraging enterprises in equipment manufacturing sectors such as aerospace, shipbuilding, automotive, and robotics, consumer goods industries such as textiles and apparel, arts and crafts, and food processing, as well as e-commerce logistics, to innovate and launch programs including production process observation, simulated operations, hands-on experiences, and product customization, creating themed sightseeing factories while ensuring production safety and confidentiality requirements. It called for orderly expansion of smart industrial tourism, supporting the use of BeiDou, artificial intelligence, ultra-high-definition video, virtual reality, autonomous driving, and other digital technologies and equipment to create immersive and intelligent industrial tourism experiences. It supported industrial tourism venues in developing themed commerce, immersive experiences, specialty markets, and other formats to create "industrial tourism+" consumption scenarios. It encouraged localities to launch a batch of high-quality industrial tourism routes and brands with regional and industry characteristics. It encouraged industrial enterprises to strengthen product promotion, expand product sales, and build enterprise brands through industrial tourism.
The Shanghai International Energy Exchange announced adjustments to the daily price limit for crude oil and low-sulfur fuel oil futures contracts to 17%, the hedging position trading margin ratio to 18%, and the general position trading margin ratio to 19%; it also adjusted trading limits for related crude oil and low-sulfur fuel oil futures contracts.
US dollar:
As of the overnight close, the US dollar index fell 0.07% to 98.93, down 0.39% on the week and up 0.85% on the month. Market optimism over the extension of the US-Iran ceasefire agreement weakened safe-haven demand.
The US April PCE price index rose 3.8% YoY, the highest level since May 2023, in line with expectations, compared to the previous reading of 3.5%; the US April core PCE price index rose 3.3% YoY, a new high since November 2023, also in line with expectations, compared to the previous reading of 3.2%. Additionally, separate data released by the Bureau of Economic Analysis showed that the US economy grew at an annualized rate of 1.6% in Q1, below preliminary data. The initial estimate released last month showed growth of 2%. The data indicated that US consumers became more cautious amid cost-of-living pressures and uneven labor market performance. The Middle East conflict pushed up fuel and other raw material prices, with the impact transmitting to the broader economy and sending consumer confidence to record lows. Meanwhile, this inflation data is likely to further reinforce warnings from some US Fed officials that if price pressures fail to ease, the US Fed will need to consider raising interest rates. Kevin Warsh, who was just sworn in as Fed Chairman on May 22, may need to convince other officials that inflation expectations can be controlled without rate hikes. (Wallstreetcn)
Minneapolis Fed President Kashkari said it is too early to conclude that interest rates need to rise, but he believes the US Fed should keep all policy options open. He stated it is too early to conclude that an immediate rate hike is needed. The Fed needs to continue watching economic data and monitoring developments in the Middle East conflict before he would consider whether policy adjustments are necessary. Kashkari noted that under both the most optimistic and most pessimistic scenarios, inflation could remain significantly elevated for an extended period. He is closely monitoring this risk, as well as the possibility that inflation expectations could become unanchored. (Wallstreetcn)
US Fed Vice Chair for Supervision Michelle Bowman said it is too early to judge the impact of the Iran conflict on inflation, and policymakers need to look through transitory price shocks. She supported officials retaining language in their statement after last month's policy meeting that hinted further interest rate cuts remain possible. As she thinks about the future path of monetary policy, she wants a clearer understanding of the economic impact of the Middle East conflict and the persistence of those effects. As long as the Fed maintains credibility in its commitment to achieving its inflation target, it is appropriate to look through transitory inflation increases driven primarily by rising energy prices. She expects the "one-time" impact of tariffs implemented by US President Trump to fade. (Wallstreetcn)
Macro:
Next week, China will release May RatingDog Manufacturing PMI and May RatingDog Services PMI data; the US will release May S&P Global Manufacturing PMI final, May ISM Manufacturing PMI, April construction spending MoM, April JOLTs job openings, May ADP employment, May S&P Global Services PMI final, May ISM Non-Manufacturing PMI, April factory orders MoM, May Challenger job cuts, initial jobless claims for the week ending May 30, May unemployment rate, May seasonally adjusted non-farm payrolls, May average hourly earnings YoY, and May average hourly earnings MoM data; the UK will release May Nationwide house price index MoM, May Manufacturing PMI final, April central bank mortgage approvals, May Services PMI final, and May Halifax seasonally adjusted house price index MoM data; the Eurozone will release May Manufacturing PMI final, April unemployment rate, May CPI YoY preliminary, May CPI MoM preliminary, May Services PMI final, April PPI MoM, April retail sales MoM, Q1 GDP YoY revised, and Q1 seasonally adjusted employment QoQ final data; Switzerland will release April real retail sales YoY, April trade balance, May CPI MoM, and May seasonally adjusted unemployment rate data; France will release May Manufacturing PMI final, May Services PMI final, April industrial output MoM, and April trade balance data; Germany will release May Manufacturing PMI final and May Services PMI final data; in addition, Australia Q1 GDP YoY and Canada May employment data will also be released.
Crude oil:
As of the overnight close, oil prices in both markets fell together, with WTI down 1.28% and Brent down 0.87%. On a weekly basis, oil prices suffered heavy losses this week, with WTI down 9.15% and Brent down 8.3%, both recording a second consecutive weekly decline and the largest weekly drop since April. WTI fell 16.47% on the month and Brent fell 16.77% on the month, with WTI posting its largest monthly decline since November 2021 and Brent its largest monthly decline since March 2020. According to Xinhua News Agency, US President Trump said on the 29th that the US and Iran had reached agreement on secondary issues beyond Iran's nuclear program and Strait of Hormuz passage, and crude oil fell in response.
The oil market in May underwent a clear three-phase evolution: Early month (May 1-6): Oil prices pulled back slightly from near four-year highs, but Brent briefly surged to around $114 after OPEC+ announced a modest production increase and shipping attacks, before plunging to the $101-106 range after US-Iran de-escalation signals emerged. Mid-month (May 7-20): Oil prices oscillated between ceasefire breakdowns and mediation progress, with the continued blockade of the Strait of Hormuz maintaining an elevated risk premium. Month-end (May 21-29): Driven by reports of a US-Iran agreement in principle to reopen the strait, Brent briefly fell to the $93-100 low range, WTI touched $88-92, and Brent closed around $92. (Wallstreetcn)
Nevertheless, analysts emphasized that until the conflict truly ends and the strait resumes normal passage, global crude oil inventories will continue to deplete by approximately 10 to 14 million barrels per day, and physical market fundamentals remain tight. The decline in oil prices under ceasefire expectations reflected more the pricing of future supply recovery rather than a fundamental change in the current supply-demand pattern. (Wallstreetcn)
Recently, reports disclosed that calculations by Goldman Sachs showed global crude oil inventories could fall below the equivalent of 100 days of global demand as early as the end of May. Goldman Sachs estimated that as of the end of April, global crude oil inventories were equivalent to approximately 101 days of global demand, and were expected to fall to 98 days by the end of May. Of this, "visible inventory" observable through satellites and other means was estimated at only 73 days of demand. Reports indicated that currently only a few vessels can pass through the Strait of Hormuz each day, resulting in a daily global crude oil supply loss exceeding 10 million barrels. (Wallstreetcn)
![Ferrous Metals May Rebound Slightly Next Week [SMM Steel Industry Chain Weekly Report]](https://imgqn.smm.cn/usercenter/nzckS20251217171747.jpg)
![[Haier Smart Home: The Company's Products Are Steadily Expanding from Companion and Cleaning Products to More Complex Household Task Scenarios]](https://imgqn.smm.cn/usercenter/wDeWQ20251217171734.jpeg)
![[Three Consecutive Daily Limit-Up Hforge Intelligent: No Revenue Generated from Nuclear Fusion and PCB Related Businesses]](https://imgqn.smm.cn/usercenter/JMPtY20251217171734.jpeg)
