Daily Report 260916

Macro Economy
Domestically, Chinese central bank's monetary policy committee Yiping Huang said on Saturday that so far China de-leveraging has not yet achieved substantial progress, saying the banking system dominated, government endorsement of credit, and monetary policy expansion are the reasons that leading to highly leverage. Monetary policy still has no possibility of expansion, and the current concern is the currency conversion between different markets and the next destination of funds once the housing market cooled.
Last week copper market was strong. Copper price continued rally tendency. Last Wednesday three main exchanges inventory decreased 10785 tons to 547000 tons. SHEX decreased 5549 tons to 131000 tons compared with before mid-autumn festival. LME decreased 5450 tons to 346000 tons. Friday LME inventory increased 10825 tons to 356875 tons. COMEX increased 214 tons to 70000 tons compared with before mid-autumn festival. LME physical continued discount tendency. Friday discount is $22. From Shanghai Metals Market, last week processing charged still maintained the highest level of $100-105/ton. This will drive the enthusiasm for production. Technically, copper price is under the rally tendency at the short term. Wait for the signal of the end of rally.
Stock Index
Last week stock index rallied from low position. Fluctuation is small, and trading volume continued low. Hot points only continued short time. News side, till recently, 1114 companies of Shenzhen and Shanghai stock markets have disclose third quarter earnings preannouncement, overall operation situations of listed companies in the third quarter are optimistic; nearly 60 percent are predicted optimistic. With rising prices and continued loose, long-term logic increasingly blurred. Most possibly will be a narrow larger range fluctuation in the short term.
                                                                                                       Dong LV (Investment Certificate NO. TZ008452)