Source: CITIC Construction Investment Author: CITIC Construction Investment Futures
The text of the research report
1. Market overview
The U.S. inflation data exceeded expectations, and the market risk appetite fell. This week, copper prices turned from up to down.Shanghai CopperIt runs in the range of 63,500-61,900 yuan / ton, and the London copper runs in the range of 7,650-8,150 US dollars / ton. The August domestic economic data released on Friday improved, and the U.S. retail sales data for August was also better than expected, and the market sentiment recovered slightly. Shanghai copper rose 1.29% in Friday night trading, and London copper rose more than 1%.
2. Market analysis
On a macro level,The US August inflation data released at the beginning of the week exceeded expectations, and the market’s expected inflation peaked and failed, indicating that the Fed has a long way to go to fight inflation in the future. After the data was released, the U.S. dollar index jumped, the macro sentiment weakened, and expectations for a 75 basis point rate hike by the Federal Reserve increased, and the possibility of a 100 basis point rate hike was not even ruled out. With the exception of the United States, high inflation in major economies such as the euro zone will undoubtedly hurt economic prospects.
In terms of employment,The number of Americans applying for unemployment benefits last week was 213,000, lower than the expected 226,000, and the previous value was also revised to 218,000 from 222,000. Better jobs data further boosted the odds of a sharp rate hike in September.
Basically,LME inventories fluctuated at a low level, and the stocks of the Shanghai Futures Exchange increased sharply for two consecutive days. The depletion of the stocks of the Shanghai Futures Exchange may come to an end, and the support for copper prices may weaken. On the supply side, the Peruvian Mining Association said on Friday that the protests would jeopardize 30 percent of copper production. On the demand side, under the trend of slowing global economic growth, downstream demand will also be restrained to a certain extent.
From the perspective of market performance,In the early stage, the market expected that inflation may have peaked, but after the release of inflation data this week, the expectations fell short, and copper prices fell under pressure due to this. Judging from inflation data, the Fed still has a long way to go to fight inflation, and copper prices will remain under pressure under the tightening monetary policy.
The point of view strategy
in summary,The macro level is generally bearish, and the fundamental support may also weaken. Before the Federal Reserve announces its interest rate decision next week, copper prices may continue to be under pressure.
Operation strategy:It is expected that the copper price will fluctuate weakly, and it is recommended to place empty orders on rallies.
risk warning:Supply is lower than expected, downstream demand is higher than expected, and monetary policy is tightened less than expected
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