Analysis of copper price trend in Yangtze River spot market (6.19-6.23)

Macro: Abroad, oil prices suffered a heavy hit this week, falling to a nearly 10-month low on Wednesday night, but the slowdown in the dollar rally brought some positive, despite the hawkish comments of the Federal Reserve, but the recent data released show that the US economic recovery momentum has slowed down, and more assessment agencies said that the rise in inflation in the US economy is worsening, the Fed will raise interest rates in the second half of the year to face certain resistance, the dollar has been under pressure to hover around the 97 line, in addition, crude oil prices recorded a slight rebound on Thursday, base metals were supported and rose
。 Domestically, the People's Bank of China released liquidity in the open market at the beginning of the week, driving a general rebound in commodities, in addition, customs data released, China's refined copper imports in May 265053 tons, compared with April imported refined copper volume up 30.
81% month-on-month, down 16.
98% year-on-year, copper ore imports 1153709 tons, down 19.
24% year-on-year, the market has signs that copper market supply is constantly tightening, copper market increased positions, won 640 million funds favored, short-term or will continue to maintain strong operation
。

In terms of the market: approaching the mid-year settlement period, the financial pressure gradually increased, the holders were forced to reduce the cash copper discount, speculators because the discount range was not enough psychological price, the attractiveness was limited, downstream enterprises maintained on-demand delivery, and the characteristics of oversupply were prominent
。 This week's copper spot market performance is poor, copper price high volatility makes the market fearful, traders at the end of the quarter generally tight money, trading performance is also average, smelters control shipments, market supply gradually reduced, but still not see downstream replenishment behavior, discount continues to relax; On Friday, the demand off-season made the downstream pickup situation unsatisfactory, traders were difficult to ship, and the surge in copper prices in the afternoon deepened the market's fear of heights, and there were few
transactions.

Inventories: London copper stocks fell this week, with a weekly cumulative reduction of 9,750 metric tons to 258,700 metric tons, a cumulative decline of 3.
63%, updating an eight-week low
.
Shanghai copper stocks fell by 13,733 tonnes to 185281 tonnes this week, down about 6.
9%.

The continuous decline in LME copper stocks has provided some support to copper prices, of which North American stocks fell from 50,850 tons on May 5 to 32,475 tons in the week of June 16, a decrease of 36.
14%; Stocks in Asia fell by 27.
46%
from 253,750 tonnes on May 5 to 184075 tonnes in the week of June 16.
The reason for the decline in LME inventories is on the one hand, China's imports in May soared by 30% month-on-month, and on the other hand, it is affected by the arbitrage window formed by LME copper and COMEX copper, which can be confirmed by the changes in LME New Auerliang Port copper stocks and COMEX copper stocks
.

Aftermarket analysis: Recently, real estate control policies continue to exert force, the latest data show that the year-on-year increase in the price of new commercial housing in 15 domestic first-tier and hot second-tier cities has all declined, and 9 cities have declined or remained flat month-on-month, and China's property market continues to cool down causing concerns about the outlook for copper demand
.
In addition, the market digestion inventory process continues to advance, but the inventory of the two cities is still at a high level, resulting in limited support for copper prices in the short term, and oversupply pressure still exists
.
In summary, with the advent of the consumption off-season and the tightening of liquidity at the end of the quarter, the outlook for copper demand may be cloudy, but the inventory data of the two cities to maintain the downward momentum is expected to limit the decline in copper prices
.