Analysis of copper price trend in Yangtze River spot market (7.3-7.7)

Macro: Domestically, the latest release of China's official manufacturing PMI for June exceeded expectations, of which the construction industry prosperity index rose to the year's high, beautiful data made investors optimistic about the outlook for China's industrial metal demand, copper prices performed smoothly at the beginning of the week, but due to the re-depreciation of the yuan during the week, market caution heated up, base metals take profit pullback, copper prices fluctuated
downward 。 Abroad, the minutes of the Fed's June meeting warned that risk asset prices are too high, there are differences on when to reduce the balance sheet, the ADP employment data released on Thursday is less than expected, the dollar has recovered from a low level, in addition, the monetary policy of many central banks continues to tighten, the market is increasingly bearish, and the sentiment of the copper market has fallen
sharply.

Market: At the beginning of the week, copper prices showed a weak market and fell from the high, but the overall bullish willingness of the market is still strong, so the holders of goods have risen to the discount, making the spot copper discount range narrow rapidly
.
The maintenance news of the Jinchuan smelter has aggravated the market's expectations for the tightening of the supply source in the future, and the spot copper premium continues to rise
.
Coupled with the large number of foreign traders handing over this week, the source of imported copper flowing into the country has also decreased, further aggravating the forced shortage of supply in the domestic market, causing the good copper premium to soar to more than
100 yuan during the week.
However, although the attitude of the holders is very resolute in selling, the downstream merchants do not cooperate, with the arrival of the traditional off-season, the downstream merchants expect that the orders in the future market will decrease, so they maintain on-demand stocking, so the actual market volume is not large
.

Inventories: Inventories have risen
in both markets recently.
London copper inventories rose this week, with a cumulative increase of 65,375 metric tons to 249,700 metric tons, a cumulative increase of 26.
18%, reported at a more than one-month high on Wednesday, and the sharp rise in inventories weighed on downstream trading enthusiasm, and copper prices fell
accordingly.
Shanghai copper inventories rose by 6,184 tonnes to 182804 tonnes this week, up about 3.
5%.

On the whole, although LME copper inventories continued to decline some time ago, the surge in consecutive days this week shows that the actual market demand is still general, so for the future market, it is expected that the market transaction is still difficult to improve, which will inevitably limit the upside of copper prices in the later period
.

Aftermarket analysis: The main factors affecting the copper market in the past two weeks are China's economic data in June and Peru's strike expectations, on the whole, before the expected copper consumption traditional off-season, the possible strike leads to the supply of copper mines is unstable under the expectation that copper prices are strong, short-term pullback may end, and it is expected that next week's shock is more likely
.
In the long run, due to the decline of the State Grid planning, the tightening of real estate policies, the halving of automobile purchase tax incentives, and the tightening of cargo policy policies, copper prices in the second half of the year are not optimistic, and it is expected that short-term copper or will continue to fluctuate, with prices of 45,000-48,000 yuan / ton
.