Base Metals Show Mixed Performance; Lithium Carbonate and SHFE Lead Rise Over 1%, Iron Ore and Polysilicon Lead Decline [SMM Midday Review]

SMM June 17 news:

Metal market front,

as of the midday close, domestic base metals showed mixed performance. SHFE copper rose 0.33%, SHFE aluminum rose 0.17%, SHFE lead rose 1.04%, SHFE zinc fell 0.48%, SHFE tin fell 0.33%, and SHFE nickel fell 0.22%.

Additionally, the most-traded cast aluminum futures rose 0.58%, the most-traded alumina contract fell 0.1%, the most-traded lithium carbonate contract rose 1.54%, the most-traded silicon metal contract edged up, and the most-traded polysilicon futures fell 1.68%.

Ferrous metals mostly fell, with iron ore down 1.89%, rebar down 0.38%, hot-rolled coil down 0.3%, and stainless steel up 0.66%. Coking coal and coke: the most-traded coking coal contract fell 0.48%, and the most-traded coke contract fell 0.95%.

Overseas base metals, as of 11:39, LME metals showed mixed performance. LME copper and LME nickel edged up, LME aluminum rose 0.53%, LME lead fell 0.1%, LME zinc rose 0.13%, and LME tin rose 0.27%.

Precious metals, as of 11:39, COMEX gold fell 0.08%, COMEX silver rose 0.39%. Domestic precious metals: the most-traded SHFE gold contract fell 0.26%, and the most-traded SHFE silver contract fell 0.27%.

Additionally, as of the midday close, the most-traded platinum futures rose 1.59%, and the most-traded palladium futures edged up.

As of the midday close, the most-traded European container shipping futures contract fell 2.95% to 3,697.5 points.

As of 11:39 on June 17, some futures midday market conditions:

Spot and fundamentals

Copper: Today, Guangdong #1 copper cathode spot prices against the front-month contract: high-quality copper was quoted at 210 yuan/mt, unchanged from the previous trading day; standard-quality copper was quoted at a premium of 150 yuan/mt, unchanged from the previous trading day; SX-EW copper was quoted at a premium of 90 yuan/mt, unchanged from the previous trading day. The average price of Guangdong #1 copper cathode was 105,500 yuan/mt, up 565 yuan/mt from the previous trading day, and the average price of SX-EW copper was 105,410 yuan/mt, up 565 yuan/mt from the previous trading day. Spot market: Guangdong inventory, after two consecutive increases, finally declined again today, mainly due to reduced arrivals and increased shipments...

Macro front

China:

[Financial Regulatory Administration: Promote better concentration of financial resources in emerging and future industries] Ding Xiangqun, head of the National Financial Regulatory Administration, stated that serving the real economy must always be the foundation of financial development, optimizing the structure of capital supply and doing a good job in the "five major articles" of finance. Efforts will be made to promote the development of new quality productive forces. The full-cycle technology financial services system should be continuously improved, financing support and insurance guarantees should be strengthened, and financial resources should be better concentrated in emerging and future industries. Effectively support the strategy of expanding domestic demand. Financial regulatory authorities should guide financial institutions to deeply participate in the fiscal-financial coordination for promoting domestic demand, assist in implementing special actions to boost consumption and improve service industry capacity and quality, and strengthen financial services for major projects under the 15th Five-Year Plan. Strengthen financial support for weak links. Promote the effective improvement of quality and reasonable growth of quantity in small and micro enterprise loans. Develop exclusive inclusive products for new employment groups such as truck drivers, ride-hailing drivers, couriers, and food delivery workers, known as the "two drivers and two workers." Continuously improve financial services for disaster prevention, reduction, and relief to fortify the line of defense for people's livelihoods. (CCTV News)

[PBOC: Improve the short-end interest rate control mechanism] Pan Gongsheng, Governor of the People's Bank of China, stated that the short-end interest rate control mechanism will be improved. Based on the establishment of temporary overnight repo and reverse repo tools in July 2024, the tool usage mechanism will be refined, and the operating rates will be adjusted to the 7-day reverse repo operating rate plus or minus 25 basis points, narrowing the range from 70 basis points to 50 basis points. The open market operation toolkit will be further enriched, and overnight reverse repo operation varieties will be added at appropriate times to better match the short-term liquidity needs of the banking system. (CCTV News)

[Full text of the "Shanghai International Financial Center Development Offshore Finance Action Plan" released] The People's Bank of China, the National Development and Reform Commission (NDRC), the National Financial Regulatory Administration, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and the Shanghai Municipal People's Government jointly issued the "Shanghai International Financial Center Development Offshore Finance Action Plan." It mentions that by the end of 2027, an institutional system adapted to offshore financial business will be preliminarily established, including business rules, risk management and disposal, and business environment, and offshore financial business exploration will be conducted based on digital frontiers to better serve enterprises "going global"; by the end of 2030, a relatively mature offshore financial institution and legal system will gradually take shape, providing safe and reliable financial services for the continuous international investment and trade of Chinese enterprises, testing for the onshore financial system reform, and strongly supporting the development of RMB global asset allocation and risk management functions; by the end of 2035, it will become a strategic hub for high-level coordinated development of offshore and onshore finance, leading the country's high-level financial opening-up and high-quality development. (From Wall Street CN APP)

[People's Bank of China establishes repo tool for overseas central bank institutions] To support the high-level opening-up of China's financial market and facilitate RMB liquidity management for overseas central bank institutions, the People's Bank of China will provide RMB liquidity to qualified overseas central bank institutions through the FIMA RMB Repo tool. Overseas central bank institutions refer to overseas central banks or monetary authorities, international financial organizations, and sovereign wealth funds. The operation methods of the repo tool include pledged and outright. The types of repo bonds include Chinese government bonds, central bank bills, policy financial bonds, and other high-grade RMB bonds recognized by the People's Bank of China. Repo tenors include 7-day, 1-month, and 3-month. The repo rate is determined by adding points to the open market 7-day reverse repo operating rate. (People's Bank of China)

[People's Bank of China optimizes the open market temporary overnight repo and reverse repo operation mechanism] To flexibly and efficiently utilize the open market temporary overnight repo and reverse repo tools, the People's Bank of China decided to optimize the operational elements starting today, adjusting the operation time to 15:00-15:30 on working days, and the operating rates to the open market 7-day reverse repo operating rate minus 25bp and plus 25bp respectively. Further clarify the tool usage rules; when the money market overnight rate (DR001) persistently remains below or above the corresponding tool operating rate, the People's Bank of China will initiate corresponding operations based on the needs of primary dealers. (People's Bank of China)

[Wu Qing: Since the new "National Nine Articles," social security, insurance, etc. have net purchased 1.3 trillion yuan of A-shares] At the opening ceremony of the 2026 Lujiazui Forum, Wu Qing, Chairman of the China Securities Regulatory Commission, delivered a keynote speech on "Further Improving the Capital Market Functions Coordinated with Investment and Financing to Better Serve New Quality Productive Forces and High-Quality Economic Development." He stated that since the release of the new "National Nine Articles" over two years ago, the circulating market value of A-shares held by social security, insurance, etc. has increased by 85%, with net purchases of 1.3 trillion yuan of A-shares. Wu Qing stated that efforts will actively broaden capital sources, support state-owned capital funds and social capital to complement each other's strengths, guide pension funds and insurance funds to increase equity investment, and promote further smoothing of the "raise, manage, invest, and exit" cycle. (From Wall Street CN APP)

[Zhu Hexin: Grant higher convenience to entities with sound operations and good credit] Zhu Hexin, Vice Governor of the People's Bank of China and Administrator of the State Administration of Foreign Exchange, stated at the 2026 Lujiazui Forum that the next step will further shift from single-business convenience to business entity convenience, granting higher convenience to entities with sound operations and good credit. (From Wall Street CN APP)

[PBOC reverse repo achieves net injection of 261.3 billion yuan today] The PBOC conducted 420.3 billion yuan of 7-day reverse repo operations today. With 159 billion yuan of 7-day reverse repos maturing today, the day saw a net injection of 261.3 billion yuan. (Jin10 Data APP)

US dollar front:

As of 11:39, the US dollar index fell 0.03% to 99.53.

Other currencies:

Goldman Sachs economist Akira Otani said that the Bank of Japan is likely to raise rates again in January 2027, but uncertainty about the timing of future rate hikes is high. "With the underlying inflation rate close to 2%, even small changes, such as a further slight depreciation of the yen, could significantly increase the risk of inflation exceeding 2%," the economist noted, "Thus, the probability distribution for the timing of the next rate hike is considered to be skewed toward an earlier hike." Otani also added that the actual timing of the rate hike will be "significantly influenced by the degree of progress in communication with the government." (Jin10 Data APP)

A senior Reserve Bank of Australia official said on Wednesday that as the tense geopolitical environment reshapes financial and economic links, Australian institutions need to prepare for a financial system more susceptible to shocks. Reserve Bank of Australia Deputy Governor Brad Jones stated: "We must accept the world as it is, not as we wish it to be, and it is in this context that policymakers are stepping up efforts to ensure the financial system can handle a more severe risk environment." Jones noted that the high proportion of foreign ownership in Australia's fixed-income market means the country's financial system will not be immune to external shocks. He mentioned pension funds: "About half of the assets in our superannuation fund industry are invested overseas." (Jin10 Data APP)

Data front:

Today, data to be released include the US May retail sales month-on-month rate, US April business inventories month-on-month rate, US May pending home sales index month-on-month rate, UK May CPI month-on-month rate, UK May retail price index month-on-month rate, Eurozone May CPI final annual rate, and Eurozone May CPI month-on-month rate. Additionally, attention should be paid to: ECB President Lagarde participating in a summit on the impact of artificial intelligence (AI), and the 2026 Lujiazui Forum in China being held from June 17 to 18.

Crude oil front:

As of 11:39, oil prices in both markets fell, with US oil down 0.32% and Brent oil down 0.32%.

Spot market overview:

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