Commodity Market Update
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Metal Market
Most base metals in China’s domestic market traded higher today. SHFE copper rose 0.97%, aluminum 0.29%, lead 0.31%, zinc 0.94%, and tin 0.35%, while nickel edged lower.
In ferrous metals, iron ore gained 0.56%, rebar rose 0.23%, and stainless steel advanced 0.57%. Meanwhile, HRC declined 0.15%, coking coal fell 0.66%, and coke dropped 2.28%.
LME
LME copper gained 0.62%, reaching an intraday high of $14,437.5/MT and remaining close to the record high of $14,527.5/MT. Aluminum declined 0.22%, while lead and zinc edged higher. Tin rose 0.19%, while nickel slipped 0.15%.
Copper Spot Market
Copper premiums in Guangdong remained firm. The average price of #1 copper increased by 700 yuan to 109,205 yuan/MT. The continued decline in Guangdong copper inventories for the seventh consecutive day provided support to the spot market.
Precious Metals
COMEX gold rose 0.26%, while silver gained 1%. In the domestic market, SHFE gold declined 0.24%, whereas silver advanced 0.64%.
Macro Update
During its 15th Five-Year Plan, China is expected to focus on 6G technology, green manufacturing, and advanced materials. The PBOC conducted a net liquidity injection of 239.5 billion yuan today.
US Dollar & Fed
The Dollar Index rose 0.05% to 98.96. For the September Fed meeting, the probability of rates remaining unchanged stands at 60.4%, while the probability of a 25-basis-point rate hike is estimated at 39.6%.
Crude Oil
WTI fell 2.56% and Brent declined 2.43%. Expectations of progress in US-Iran ceasefire talks and the possibility of safe maritime passage through the Strait of Hormuz weighed on crude oil prices.
Outlook
Copper continues to receive support from firm global cues and declining inventories in China. However, profit-taking may emerge at elevated levels. Uncertainty surrounding the US dollar and Fed interest-rate policy could keep base metals volatile in the near term.
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