Shanghai Nonferrous metals mostly ended lower as investors priced in expectations for a Interest rate hike. Some even expecting a 100 basis point hike on Sep 21 Fed meeting.
Copper in Shanghai was down 0.55%, aluminum was up 0.21% and lead was down 0.76%. Zinc fell 1.83%, tin fell 0.72% and nickel 1.56%.
The most traded SHFE 2210 Copper closed up 0.55% or 340 yuan/mt to 61,950 yuan/mt., with open interest from 7,291 to 145,499 lots.
At macro level :
- US initial jobless claims of 226k and a previous print of 218k (Bearish).
- US Retail Sales for August were 0.3% vs. 0% forecast and -0.4% previous (Bearish).
In the spot market middle players have not yet been very active in participating in market trades. Buyers and sellers have had considerable disagreement over whether premiums can hold current highs next week. Buyers believed the high premiums were the result of delays in the arrival of imported copper due to the typhoon.
Sellers believed market trading will be active next week. As long-term orders are placed and the expected fall in copper prices, amid the Expectations for an aggressive rate hike by the US Federal Reserve in September.
But the supply side was still tight and the market is likely to see big surprises even after premiums fall from above.
The most traded SHFE 2210 aluminum closed down 0.21% or 40 yuan/mt to 18,735 yuan/mt with open interest down 2,523 lots to 173,581 lots.
On the supply side, some aluminum smelters in Yunnan reported increasing production cuts estimated at 20-30%. In contrast, there are still no signs of improvement in the downstream processing areas. So the market is now intertwined with long and short positions. However, expectations remain that inputs will recover as peak season begins, on top of better policy support.
SHFE Aluminum is expected to trade between 18,300 and 19,200 yuan/mt in the short term.
The top traded SHFE 2210 lead closed up 0.76% or 115 yuan/mt at 14,925 yuan/mt with open interest down 1,939 lots to 43,101 lots. In the spot market, Quotes offered by smelters have been flat recently Particularly for secondary lead.
Sellers were less willing to sell after lead prices fell due to high raw material costs.
The top-traded SHFE 2210 zinc closed down 1.83% or 455 yuan/mt at 24,350 yuan/mt with open interest falling to 108,808 lots from 6,933 lots.
Shorts have been quite active recently given increased social zinc inventories and lower downstream operating rates.
As a result, SHFE zinc saw slightly larger declines today.
The top-traded SHFE 2210 tin closed down 0.72% or 1,280 yuan/mt at 176,250 yuan/mt, with open interest falling 967 lots to 32,925 lots. , And some smelters remained particularly firm on their prices, widening the spread between prices.
According to traders, sources have been relatively scarce while premiums have changed little. Downstream still bought due to high demand, but charged lower prices.
The most traded SHFE 2210 nickel closed up 1.56% or 2,960 yuan/mt at 186,860 yuan/mt with open interest falling to 73,993 lots from 8,536 lots.
In the spot market, JINCHUAN NICKEL achieved premiums of 5,500-6,100 yuan/mt, averaging 5,800 yuan/mt.
A daily increase of 450 yuan/mt. NORNCIEL NICKEL had premiums of 2,800-3,000 yuan/mt, averaging 2,900 yuan/mt, up 150 yuan/mt from the previous trading day.
Spot premiums were largely flat today as SHFE nickel was slightly down today. Briquette prices ranged from 187,900 to 188,700 yuan/mt, down 6,050 yuan/mt from the previous day.
Transactions remained near zero as briquette profitability declined. – SHREE METAL PRICES