According to public data, as of the close on July 4, the prices of many major industrial metal futures contracts, including copper, aluminum, zinc, nickel, lead, etc., have fallen to varying degrees since the second quarter, arousing widespread concern among investors.
As of the close on July 4, the price of nickel fell by 23.53% within the month, followed by the price of copper fell by 17.27%, the price of aluminum fell by 16.5%, the price of zinc (23085, 365.00, 1.61%) fell by 14.95%, and the price of lead fell by 4.58% .
In this regard, Ye Yindan, a researcher at the Bank of China Research Institute, said in an interview with the “Securities Daily” reporter that the factors that have caused the prices of major domestic industrial metal commodity futures to continue to decline since the second quarter are mainly closely related to economic expectations.
Ye Yindan introduced that overseas, the manufacturing industry of the world’s major developed economies has begun to weaken, and investors are increasingly worried about the prospects of industrial metals. Under the influence of rising inflation, interest rate hikes by the Federal Reserve and geopolitical situations, industrial activities in major global developed economies such as the United States and Europe have slowed down sharply. For example, the U.S. Markit Manufacturing PMI in June was 52.4, a 23-month low, and the European manufacturing PMI was 52, falling to a 22-month low, further increasing market pessimism. Domestically, due to the impact of the epidemic in the second quarter, the demand for industrial metals was hit by a short-term impact, increasing the pressure on prices to fall.
”It is expected that industrial metal prices are expected to be supported in the second half of the year.” Ye Yindan said that the global stagflation situation will be more severe in the second half of the year. According to historical experience, industrial metals are expected to be supported by upward forces during the stagflation period. In the domestic market, as the epidemic further eases, and with the frequent favorable policies, the consumption of industrial metals is expected to bottom out in the second half of the year.
In fact, in the first half of the year, my country launched a series of economic stimulus policies and tools, laying the foundation for economic growth in the second half of the year.
On June 30, the National Standing Committee identified 300 billion yuan of policy development financial instruments to support the construction of major projects; on May 31, the “Notice of the State Council on Printing and Distributing a Package of Policies and Measures to Stabilize the Economy” was released, requiring that the economy be stabilized in the second quarter. We will strive to build a solid foundation for development in the second half of the year and keep the economy operating within a reasonable range.
CITIC Futures believes that in the international market, the extreme shock in June has passed. At the same time, domestic expectations for steady growth in the second half of the year continue to improve. The regulatory requirements require local governments to submit the third batch of debt projects. The government actively stabilizes the economy through infrastructure construction, which will help improve macro expectations. It is expected that the overall price of non-ferrous metals will fluctuate and stop falling.
Wang Peng, associate professor of Renmin University of China, told the “Securities Daily” reporter that from a domestic perspective, the domestic economic situation will rebound relatively quickly in the second half of the year. Continue to thrive.
Wang Peng introduced that in the first half of the year, affected by the epidemic and the international situation, the operation of some industries such as manufacturing and logistics in my country was suppressed. Since the end of the second quarter, the domestic epidemic has been effectively controlled, economic production has recovered rapidly, and market confidence has continued to increase. The positive effects of operation, expanding domestic demand and expanding investment are more obvious.
“However, whether the price of non-ferrous metals can recover in the second half of the year depends on the situation of the international market. For example, whether global inflation can be eased, whether market expectations can turn optimistic, and whether the prices of industrial metals in the international market can be adjusted, etc. These factors will affect the domestic market. Market prices have a greater impact.” Wang Peng said.
Post time: Jul-11-2022
