LIVE FUTURES REPORT 11/05: SHFE base metals prices broadly up on weaker dollar; copper, nickel leading the pack

Base metals prices on the Shanghai Futures Exchange were broadly up during Asian morning trading on Friday May 11, with copper and nickel prices putting in the strongest performances of the complex, on the back of a weaker dollar.

The SHFE base metals have mainly benefitted from the weaker dollar after US economic data released overnight disappointed.

The US headline and core consumer price indices (CPI) for April were both weaker than expected with growth of 0.2% and 0.1% respectively.

The weaker inflation risk boosted investor appetite for the metals, with the dollar slipping on the prospect that the weaker CPI reading is unlikely to increase the number of times the US Federal Reserve will raise interest rates this year.

The dollar has fallen considerably since its high of 93.42 on Wednesday – its highest reading since late December last year.

The index was down by 0.08% at 92.71 as at 10.55am Shanghai time, compared with a reading of 93.03 at roughly the same time on Thursday.

Copper prices were also likely buoyed an increase in cancelled warrants at London Metal Exchange warehouses on Thursday.

The most-traded July copper contract on the SHFE traded at 51,430 yuan ($8,092) per tonne as at 10.57 am Shanghai time, climbing 360 yuan per tonne from Thursday’s close. Around 168,000 lots of the contract have changed hands so far this morning.

“Another day of falling inventories also helped. Cancelled warrants (orders to remove metal from LME warehouses) rose by 3.1% yesterday, the first rise since April. This follows strong outflows from Asian warehouses over the past week,” ANZ Research noted on Friday.

Base metals prices

  • The SHFE July aluminium contract price rose 75 yuan per tonne to 14,700 yuan per tonne.
  • The SHFE July zinc contract price dipped 75 yuan per tonne to 23,665 yuan per tonne.
  • The SHFE June lead contract price increased 200 yuan per tonne to 19,135 yuan per tonne.
  • The SHFE Sept tin contract price fell 1,030 yuan per tonne to 145,450 yuan per tonne.
  • The SHFE July nickel contract price strengthened 460 yuan per tonne to 104,230 yuan per tonne.

Currency moves and data releases

  • The dollar index was down by 0.08% at 92.71 as at 10.55am Shanghai time.
  • In other commodities, the Brent crude oil spot price fell 0.22% to $77.30 per barrel as at 10.57 am Shanghai.
  • In equities, the Shanghai Composite dipped 0.1% to 3,157.85 as at 10.57 am Shanghai time.
  • In US data on Thursday, the core and headline CPI both disappointed with growth of 0.1% and 0.2% respectively in April. Weekly unemployment claims at 211,000 were slightly lower than the expected 219,000.
  • The economic agenda is light today with US data including import prices and University of Michigan consumer sentiment and inflation expectations of note.
  • In addition, European Central Bank president Mario Draghi is speaking.
LME snapshot at 03.57 am London time
Latest three-month LME Prices
Price ($ per tonne) Change since previous session’s close ($)
Copper 6,906 -11
Aluminium 2,311 -24.5
Lead 2,329 23.5
Zinc 3,086 -1
Tin 20,860 35
Nickel 13,920 40

SHFE snapshot at 10.57 am Shanghai time
Most-traded SHFE contracts
Price (yuan per tonne) Change since previous session’s close (yuan)
Copper (July) 51,430 360
Aluminium (July) 14,700 75
Zinc (June) 23,665 -75
Lead (June) 19,135 200
Tin (Sept) 145,450 -1,030
Nickel (July) 104,230 460

Changjiang spot snapshot on May 11
Range (yuan per tonne) Change (yuan)
Copper 51,120-51,160 150
Aluminium 14,580-14,620 70
Zinc 23,820-23,870 -100
Lead 19,100-19,300 200
Tin 144,000-145,500 0
Nickel 104,400-104,800 -200
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