Main Economic Events & LME Today

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Wednesday, May the 10th deserves to be nominated for one of the most tense days regarding this week. So much going on in financial markets, being pulled and inspired by main political events which are causing a little earthquakes all along the global scene. Will euro come to its 6-month highs lifted by Mario Draghi, and which way will the release of James Comey affect U.S. market… And what is happening with London Metal Excchange Prices today, Let’s see:


Main Economic Events Today:

  • China Consumer Price Index(CPI) YoY rose to actual 1.2% (1.1% forecast)
  • ECB President Draghi Speaks
  • U.S. Crude Oil Inventories came to actual -0.930M, while expected was -2.333M
  • New Zealand Interest Rate Decision is at actual 1.75%, same as expected
  • Reserve Bank of NZ Rate Statement (the outcome of factors on interest rates..)


Top 5 Things In Wednesday’s Market

inspired by

  1. Trump dismissed the FBI director James Comey; It was a very shocking move for Washington (and this really weighs on risk appetite)
  2. Global stocks mixed as Comey’s termination HIT western markets
  3. Oil JUMPS 1% on large inventory draw
  4. Disney set to weigh on Dow, Apple pulls back
  5. Mario Draghi might help to lift euro back to 6-month highs


LME Base Metal Prices

Dropped again, across the board of this morning. Coming after short term of recuperation at yesterday’s closing hour.

Following the publication of further unimpressive data, this time from China, copper has fallen below $5,500 per tonne and nickel is back below $9,200 barrier.

While the Chinese CPI for April at 1.2% y-o-y was better than 0.9% in the previous month, its PPI at 6.4% was below the previous figure of 7.6% and the expected 6.7%.

”Copper prices have lost upward momentum since mid-February and more recently they have gained downward momentum.”  (Metal Bulletin)

Copper goes below $5,500/t 

Firstly, three-month copper price fell $24 per tonne to trade recently at $5,488 per tonne. Secondly, copper stocks fell a net 3,625 tonnes to 339,200 tonnes. Also the Inventories started to decline on Monday this week, after they rose more than 100,000 tonnes last week.

Based on the reports of the Chinese trade balance, and their imports, Copper prices came under pressure after Monday. When data showed total copper imports into the nation fell to their lowest since October 2016.

Following, the expected second expansion phase at Polish miner KGHM’s Sierra Gorda copper project in Chile, IS CANCELED, the company announced on Monday.


Other base metals  

Speaking about Aluminium prices, the three-month price fell $5.50 to $1,865 per tonne. Stocks fell 7,225 tonnes to 1,570,575 tonnes.

“Aluminium looks a tad better but really needs to stay above $1,860 on the downside.” (FastMarkets)

Observing the Nickel, it fell $55 per tonne to $9,160 per tonne. It is hardly struggling to recover last week’s dropdown of more than $500 per tonne…

“Nickel prices will might be under pressure on weaker demand. With steady nickel trade flows from Indonesia, and some stainless steel plants starting from late May.” Nickel stocks rose 660 tonnes to 381,378 tonnes.

Noteworthy, The three-month tin price fell $55 to $19,660 per tonne, with inventories unchanged at 2,290 tonnes.

Currencies & data  

The Brent crude oil spot price was up 0.36% at $49.13 per barrel. Later, the US dollar index was effectively unchanged at 99.43. In equities, that shoes the UK FTSE 100 was down 7.17 at 7,335.04. But the power of dollar these days is not to be neglected.

Speaking about Europe, French and Italian industrial production both bid better than expectations. Especially the French trade deficit, which fell to a €5.4 billion. It bet the forecast.

US April export and import prices, crude oil stocks and the Federal budget balance are due later today. Mr Donald Trump’s decisions are often shocking for people around him as well as for the global market participants. But we can only watch and testify the outcomes by ourselves.


Shanghai Futures Exchange Today: 2nd week that copper inventories fall; Zinc stocks down 26%


Important to know of Today’s flashing news:

  • United Kingdom Gross Domestic Product (GDP)QoQ fell to actual 0.3% (while forecast was 0.4%)
  • UK GDP year on year fell bellow the forecast to actual 2.1% (2.2% forecast)
  • European Consumer Price Index (CPI) YoY grew to actual 1.9% (while forecast was 1.8%)
  • Russian Federation Interest Rate Decision fell to actual 9.75% (while expected was 10.00%)
  • Canada GDP MoM rose to actual 0.6% (while expected was 0.3%)
  • US GDP QoQ rose to actual 2.1% (forecast was 2.0%)


Shanghai Futures Exchange

Shanghai Futures Exchange: Zinc inventories, approved stockrooms fell 40,312 tons – or 25.9% – over the past week to 115,040 tons. As of Friday April 28, the biggest reduce between the SHFE base metals happened. 

The most exterior deliveries this week were in Guangdong district. With 29,982 tons, while Nanchu saw the most stock exit from a single repository – 29,177 tons left its sheds this week.

Growing expectations of tightening supply in the base metals could be behind the fall downs seen in SHFE and London Metal Exchange stocks.

“In the opinion of the International Lead and Zinc Study Group (ILZSG), the global zinc market will see a high supply deficit for the second consecutive year in 2017. The ILZSG puts this deficit at 226,000 tons. Which is only a little lower than the figure predicted six months ago. As with lead, supply and demand for zinc are expected to grow by the same amount [namely 2.6%]. If so, the zinc market will be significantly undersupplied for the fourth time in the last five years.” (Commerzbank) (Metal Bulletin)

Past month recollections & positive future expectations

“During the past month, all base metals have had recent supply disruptions. Copper inventories [on the LME] have fallen over 16%. Also, zinc is down 9%, while lead 8% . Finishing with aluminium failure for 6%. Recent supply disruptions  maybe had impact on this.”

“Still, economic data has also been relatively positive. Predicting that this drop is likely to be only a short-term phenomenon.”




Aluminium and nickel stocks up; others see a decline 

SHFE copper stocks fell 10,830 tons or 4.5% over the past week to 229,361 tons with Shanghai district seeing the most stock – 10,183 tons – leave its sheds, while SIPG Logistics saw the most red metal exit a single warehouse with 7,832 tons.

At the same time Aluminium stocks rose. 12,544 tons to 391,578 tons in the week ended April 28.
Lead stocks at SHFE dipped 218 to 72,070 tons as of Friday.
Nickel stocks at SHFE-bonded warehouses rose 439 tons to 84,334 tons as of Friday.
SHFE tin stocks fell 19 tons to 2206 tons over the past week.