Daily Report 230915 2015-09-23
Macro Economy
Overnight US stock market dropped, materials sector went low followed commodities; biological technology sector selling momentum increased; scandal of Volkswagen cheated on its diesel cars further hammered global automobile sector. S&P 500 closed down 24.23 point to 1942.74 point, decreased 1.23%. The head of the International Monetary Fund, Christine Lagarde, indicated global slowed down productivity was disturbingly; China’s economy slowed down was the main risk for global economy. Commodity market as well slumped, sectors as crude oil and metal all showed large decrease range.
On domestic side, China central bank had issued business rules of CIPS; it was estimated to online in the beginning of October; BOC, CCB, ICBC and other nineteen banks had won the first direct participants qualification for CIPS. China central bank website announcement showed, HSBC was allowed to issue RMB 1 billion ($157 million) financial bond between banks, which was the first time International commercial Banks approved to issue RMB bonds at interbank bond market. This series of actions would bring positive impact on RMB internationalization. In addition, Caixin China September manufacturing industry PMI initial value would issue on this morning 9:45, market estimated mid-value was 47.5 which higher the August 47.3 and, still lower the entrepreneurs confidence threshold.

Tuesday copper price sharply decreased over 3%, trading volume and holding had cooperated well. Since market was concerning on global economy, yesterday European and U.S. stock both in poor performance; copper price was dragged as well. Back to copper market, Tuesday LME spots premium $11.75, inventory decreased 5750 tons. Domestic spots were discount RMB 70 to premium RMB 10; participation of brokers and downstream was low, trading back to light. As for supply side, yesterday Chile unexpectedly announced to subsidize the copper enterprises, which means situation of oversupply copper market was hard to see substantial Improvement in short term, and this would bring downward momentum to cooper price. Technically, copper price was weakened and might try low point in the future market.
Along with new grain coming into market, the bearish momentum was increase. New bean quotation of the regions in Heilongjiang Province such as Suihua and Qishi had fallen back to RMB 2.05/ half kg; the main reason was pessimism estimation to future market, which made buying and selling momentum thin in short term.
Soybean spots were mixed with increase and decrease momentum, stock up before two holidays ended; inventory was strong in south and light in north in selling regions, quotation down to RMB 2680-2730/ton. Market still lacked of good news to boosting in a short term, meals would continue the volatile trend and seek the direction for breaking through. We recommend operating with slight positions in short term before holidays.

                                                                              Dong LV (Investment Certificate NO. TZ008452)