Domestic economy has downward pressure The copper market as a whole is under pressure

In terms of terminal demand, the cumulative value of power grid capital construction investment from January to September was 337.
3 billion yuan, with a cumulative year-on-year growth rate of -9.
6%.

Due to last year's high base, the growth rate of grid investment has been negative this year, but the decline rate has clearly slowed down
in recent months.
The production of air conditioners in September was 16.
083 million units, a year-on-year increase of 9.
3%, which shows that in the off-season, air conditioning production also performed
well.
The peak season of automobile production will begin in September, and production will increase
significantly.

However, downward pressure on China's economy remains an important suppressive factor above copper prices, with a number of previously released economic data performing poorly, including the October manufacturing PMI falling 0.
6 percentage points month-on-month to 50.
2%.

In the sub-indicators, the new orders index fell by 1.
2 percentage points month-on-month, and the raw material inventory index fell by 0.
6 percentage points month-on-month, falling below the 50% critical value for several months, suggesting the pessimism of manufacturing companies
.

On the supply side, although it has become a market consensus that there will be a shortage of copper mine supply in the next 1-2 years, the short-term supply is relatively loose
.
Imported copper concentrate TC bottomed below $80/mt from March to May this year, rose all the way after June, and remained around $90/mt in recent weeks, and refiners are not in a hurry to stock up
despite TC rising all the way.
From the perspective of processing fees of domestic smelters, crude refining fees rose continuously in the third quarter, reaching $91/dry ton in September, and the rising processing fees suggest that the supply of copper concentrate is more abundant
.

Meanwhile, China's refined copper production in September was 764,000 tons, up 2% month-on-month and 10.
4% year-on-year; From January to September, the cumulative output of refined copper in China was 6.
607 million tons, still maintaining double-digit high growth
.
Therefore, the supply of both copper concentrate and refined copper shows no signs of tightening, and the pressure on the supply side remains
.

In terms of inventories, LME copper stocks fell by 64,775 tonnes in October, a decline of 32%; COMEX copper stocks fell relatively modestly, down 16,286 tonnes; Domestic inventories bottomed out, increasing by 19,869 tons, an increase of 54.
4%.

It can be seen that domestic inventories have rebounded significantly, and on November 2, London copper stocks increased by 43,700 tons, and the sharp recovery of stocks still needs to be
treated with caution.

Macro uncertainties are intensive
.
On November 5, the US sanctions against Iran were officially implemented, but exempted eight countries and regions, which account for most of Iran's oil exports, coupled with the accumulation of crude oil inventories, oil prices once fell, which also dragged
down commodities.
In the past two days, the United States has held a mid-term election, and the election results will directly affect the medium and long-term trend of the US dollar, thereby indirectly affecting copper prices
.
In addition, after the call between Chinese and American leaders, there was news that the Sino-US trade agreement was being drafted, Trump said that he hoped to reach an agreement with China on trade issues at the G20 summit held at the end of this month, market optimism was driven, and the sudden change in the attitude of the Trump administration was not ruled out as a positive signal
for the midterm elections.
Ahead of the G20 summit and the finalization of the Sino-US trade agreement, there are still many uncertainties at the macro level, and copper prices remain cautious for the time being
.

At the level of market sentiment, COMEX1 copper non-commercial positions maintained a brief three-week net short position in September this year, and then turned into a net long position, and the current long and short position is in a state of stagnation, which also reflects the oscillation of copper prices
.
For the week ended October 30, COMEX1 copper non-commercial net long positions decreased by 8,680 to 667, while non-commercial short positions increased by 9,330 and non-commercial long positions increased by only 650
.
It can be seen that the bearish sentiment accumulated by the sharp fall in copper prices in the early stage is difficult to dissipate in the short term, and it has also formed a lot of suppression
on copper prices.