Daily Report 100615 2015-06-10
Macro Economy
As for domestic market, CPI inflation rate in May fell even further and did not reach the half target of government, had been continuously remain in “1” era for straight 9 months; PRI continues to fall for 37-month with year on year basis; food price inflation rate fell back; that pork, vegetable, fruit price increasing trend slowed down was the main reason, moreover the fruit price dropped year to year; the rally of crude oil price continues driving fuel price decreasing rate slowed down, previous house price rally also driven rental price increased faster.
Indicated from later period, sluggish domestic demand and seasonal factors may still leads to inflation tends to weak, if current trends continue it will be hard to accomplish 3% of annual government target, there are still necessity and space to ease the policy.
Stock Index
Yesterday stock index retraced, bank stock leaded downward trend, yesterday SSI50 increase rate taking, Shanghai Stock Index closed down overcast. By price slumped in last week, market mentality was unstable, continuously increasing caused more concerns however, afraid to lose the opportunity to bottom fishing. In the high position, there is no new concept but only reproduced old one which is hard to attract continues momentum. Currently as for CSI500, market turns up confused for concept stock high valuation; major shareholders reduce holdings, well-known people in the industry shows incomprehension inevitably expand investors concern. As for traditional blue chip, the weaken economic data narrows imaginary space, investors chase after bottom opportunity from price earnings ratio, once it rally will hard to gain continues pursuit. As for a wide conception, bull market still remains, not as a unilateral bull but a fluctuant bull. From futures operation point, currently high position volatile is not appropriate for firmly holdings, since risk-reward ratio is not as good as used to be.
Technically, breakthrough had not authentic formed (including SSI). It was predicted intraday will volatile in high position and we recommend operate in short term.
Tuesday domestic and overseas copper market investing and trading is thin, copper price pulled back from highs in adjustment.  LME spots premium $8.75, the inventory level increased 1475 tons, as for major holdings, short term still take a active role. Recently copper price rebound trend is lacking of cooperation from volume and open interest, the only attractive point is open interest from COMEX increased which made resistance line focus on 2.75 cent/pound or $6050/ton. Domestic spots investing and trading is still thin.
On the supply side, Mine output increased as expected, Africa government is trying to reduce mine output influence from power supply shortage. Peru copper yield increased 18.5% in April, which was far above the increasing rate 3.79% in past 4 months.
Technically, copper price gets resistance from 5months average price, LME is $6045, domestic is RMB43500, we recommend buy whole short term and wait for market turns to certain.
                                                                  Dong LV (Investment Certificate NO. TZ008452)