Daily Report 160615 2015-06-17
Macro Economy
Yesterday U.S. stock ended up low, S&P 500 index fell through 100-day moving average line, negotiation of Greek and creditors broke down, and U.S. manufacturing industry data is lower than expected. Up to market closing, S&P 500 fell to 2084.43point; drop range is 0.46% or 9.68point. Dada indicated U.S. manufacturing industry output value in May unexpectedly decreased to 0.2%; New York manufacturing industry index in June decreased to -1.98; home builder confidence increased to nine-month high position in June. Global weak demand and strong dollar continues constitute encumbrance, except real estate remain certain reviving, other areas especially manufacturing industry is still slow, which extensively  overshadowed the economy growth revive. Today and tomorrow Fed will host monetary policy meeting and predict will not raise rate in this meeting. As for Euro side, fatigued negotiation from Greek and creditors enhanced the uncompromising stance of each side; moreover Greek government indicated had already reached the concession limit, partial Euro zone officer openly express the possibility of Greek exiting. European Central Bank President Macro Draghi claimed present Greek government need to make next action for breaking negotiations deadlock. Athens stock exchange index fell 4.7% on Monday; Athens stock exchange bank index tumbled 8% after slumping 12% on last Friday, Greek national debt yield also soared to high position.
Currently, Greek is trying to get support of debt writes-down, even including cut domestic welfare. But divergence will continue since the counterpart will not allow it. Pay attention on situation of Euro zone Finance Ministers Conference held in Luxemburg in 18 June.
Monday domestic and overseas copper price continues dropping. On macro side, Greek had accomplished new agreement in last weekend which messed up the whole stock market, European and American stock slumped on Monday virtually hammered copper market. Currently market still focus on the Tuesday and Wednesday Fed meeting, for seeking the hint of U.S. interest rate rising in Sep. Recently the U.S. employment, retail, consumption confidence all show the reviving trend which enhanced rate raising expectation. On fundamental side, LME spots premium expand to $20; inventory slightly increased 375tons; consumption off season is approaching; it is noteworthy that whether inventories in the future will form the upward trend. Domestic spots premium RMB20-40, intraday July copper will become the spot contract, yesterday the RMB200 following-month spread signified on Tuesday spots will premium, but still worth attention on consumption buying. This Thursday and Friday Xiangguang finishing overhaul shall increase the supply. In addition, news about Tongling will overhaul this month may only influence 5thousand output.
Currently, market still get large divergence on supply side, the mine output we tracking on is increasing as expected, and the crucial is if processing charges will influence output from smelting plant. There is no hammer appears in domestic side.
Technically, LME fell through $5860 which opened a downward trend; we recommend continue holding short position on operation, set the stop-profit at $6000. Domestic resistance position is RMB42,500.

                                                                      Dong LV (Investment Certificate NO. TZ008452)