On Monday, the Shanghai Futures Exchange ushered in the opening of the market, the domestic non-ferrous metals market showed a collective upward trend, in which the Shanghai copper is to show a high opening surging momentum. The main month 2405 contract at 15:00 close, the latest offer up to 75,540 yuan / ton, up more than 2.6%, successfully refreshed the historical high.
On the first trading day after the Qingming holiday, the market pickup sentiment remained stable, and the willingness of holders to hold prices firm. However, the downstream traders still hold a wait-and-see attitude, looking for low-priced sources of willingness has not changed, high copper prices continue to buyers of the acceptance of the positivity of the formation of suppression, the overall market trading atmosphere is relatively cold.
At the macro level, the U.S. non-farm payrolls data in March was strong, triggering market concerns about the risk of secondary inflation. The hawkish voice of the Federal Reserve reappeared, and interest rate cut expectations were delayed. Although the U.S. headline and CPI (excluding food and energy costs) are expected to rise 0.3% YoY in March, down from 0.4% in February, the core indicator is still up around 3.7% from a year earlier, well above the Fed's comfort zone. However, the impact of these effects on the Shanghai copper market was limited and largely offset by the positive trend in overseas economies.
The surge in Shanghai copper prices mainly benefited from the optimistic expectations of the macro climate at home and abroad. The heating up of the U.S. manufacturing PMI, as well as the market's optimistic expectations for the U.S. economy to achieve a soft landing, together supported the strong performance of copper prices. At the same time, China's economic bottoming out, "trade-in" action program in the real estate sector to take the lead in the start, coupled with the current peak season of consumption, "silver four" background, metal demand recovery is expected to gradually warm up, and further consolidate the strong position of copper prices.
Inventories, the Shanghai Futures Exchange latest data show that April 3 week Shanghai copper stocks increased slightly, weekly stocks rose 0.56% to 291,849 tons, reaching a nearly four-year high. London Metal Exchange (LME) data also showed that last week's Lunar copper inventories showed range fluctuations, the overall recovery, the latest inventory level of 115,525 tons, the copper price has a certain suppression effect.
At the industrial end, although domestic electrolytic copper production in March exceeded the expected growth year-on-year, but into April, domestic smelters began to enter the traditional maintenance period, capacity release will be limited. In addition, the market rumors that domestic production cuts, although initiated, but did not make TC stabilized, the follow-up still need to pay close attention to whether there are additional production cuts action.
Spot market, Changjiang non-ferrous metals network data show that the Changjiang spot 1 # copper prices and Guangdong spot 1 # copper prices have risen sharply, the average price of 75,570 yuan / ton and 75,520 yuan / ton, respectively, rose more than 2,000 yuan / ton compared with the previous trading day, showing the strong upward trend of copper prices.
Overall, the macro atmosphere of optimism and supply constraints of the dual factors together to promote the strong upward trend of copper prices, the center of gravity of the price continues to probe high. Given the current market logic, in the absence of significant negative feedback on demand or recovery cycle is falsified, in the short term we we still recommend maintaining the strategy of buying low.
Post time: Apr-10-2024