Daily Report 120716 2016-07-12
Macro
Domestically, China Securities Journal claimed cited unnamed market institution that, June MLF maturity size was significantly more than last two weeks, and time-point overlapped with monthly enterprise tax payment. So central bank is expected to continue with MLF, and the possibility of ahead of schedule is large. China post new regulations of Exchange bond pledged, and decreased credit debt discount factor. Institutions include CICC claimed that supervision’s attention of deleverage is obvious.
 

 
Copper
Monday copper price was mainly recovery, and rushed to near 10 days average, then rolled back partly. Market’s expectation for economy simulation is the main reason for price rally. LME spot discount enlarged $7.25 to $20. Yesterday inventory turned to decline $625 tons to 223000 tons. Technically, copper price shows strong bolster, and the motion of increase tendency still exits.
 

 
Soybean
Domestically, DCE soybean night section was fluctuated; oil against meal ratio rolled back the recent two days. Spot goods side, Northeast China soybean price continued stable and increasing tendency; north Heilongjiang and several parts of Neimenggu producing area price increased RMB 40-60/ton. Market still boost by strong supply and need fundamentals; short of supply is more and more tense. Recently Anhui and north Jiangsu soybean dropped, and worse sales drag the price weak. Soybean meal side, spot goods price was stable and slightly increased. Several oil plant slightly increased RMB 20-30/ton; normal quotation is around RMB 3320-3380/ton. South China flood is serious, and caused some influence on breeding industry of partial provinces. The following possible epidemic and destroyed fish pond will influence the need for soybean meal, which caused short-term need decreased. We consider that recent weather influence is short-period, and market emotion reflection is larger than the real influence. As for operation, avoid largely fluctuation recently, and middle-term can go long at low point.
 

 
PP
Yesterday PP futures fluctuated at low point; opened at 8097 and closed at 8094. Trading volume decreased 458000 lots to 550000 lots. Holding volume decreased 27014 lots to767000 lots. Spot goods side, yesterday domestic PP market price slightly decreased. Several Sinopec factory price decreased, and bolster to market decreased. PP futures operate at low price position, stroke to market mindset. Cost of goods supply’s bolster to market declined. Market mindset loosed significantly. Dealers began to sell with lower price. Intraday main quoted prices for wires of north China, east China and south China markets are RMB 7900-8100/ton, RMB8100-8250/ton and RMB8100-8250/ton, respectively. Recently average system has the signal of changing, and MACD red column shortened. The possibility of rolling back increased.
                                                      Dong LV (Investment Certificate NO. TZ008452)