Daily Report 111214 2014-12-11

Main contracts of domestic gold AU 1506 opened lower and corrected in the night session. The gold broke through RMB 250 for short term and was dragged down later. In terms of operations, long positions opened when the gold broke through RMB 240 could be held. Lone-term pressure was found at RMB 252. Gold is believed to remain correcting during the intraday trading. Bolster effect at RMB 245 should be in focus. The funds have been flowing into the gold market for two days. The positions of overnight gold ETF kept increasing for 2.99 tons, indicating the funds are holding an optimistic view of the gold. However, strong pressure was found around $ 1,240 for gold in international market. It is expected that there is limited space for gold to increase.

Stock Index

Stock index fluctuated in the early market and rallied substantially in the afternoon session yesterday. Securities’ stocks have been replaced by growth stocks, green stocks and stocks related to ‘one belt and one road’ as the leading force of the market. Newly released CPI in November advanced by 1.4% on year-on-year basis. The CPI has been lower than 2% in the past three months, which is the lowest since November, 2009. The PPI has been shrinking for 33 straight months. The decrease of this term is 2.7% on year-on-year basis, which is the largest decline in the past 18 months. It is believed that the demand is still rather weak. The rate cut is then likely to take place. However, the rebound yesterday does not cover the decrease the day before yesterday, which raises concerns that whether or not the transaction risks have been released totally. Investors are not recommended to take further moves until new market trend comes up.


On Wednesday LME copper waving down, closed down by $50.5 to $6417. In terms of fundamentals, LME spot premium almost flat at $56; inventory level decreased 200 tons to 166000 tons. Domestic spot premium dropped RMB 20 to RMB 30-100. In the market, the market share of import copper is rapidly increasing; the supply is abundant; downstream buy in according to their demand. Technically, copper price is waving under $6530 which was previous the support line of consolidation range. If current resistance price is efficient will decide to what extent the copper may rally.


On Wednesday LME 3-month aluminum dropped slightly, closed at $1961.75 per ton which down by 0.52%. The office of National Statistic stated that CPI increase 1.4% year-on-year, but PPI decreased 2.7% year-on-year. Investors may buy in SHFE aluminum if it is the time.
                                                                                    Dong LV (Investment Certificate NO. TZ008452)