Nickel led the charge higher, with its most-traded April contract rising to 105,600 yuan ($15,142) per tonne at the close of Thursday’s morning session, up by 0.5% or 470 yuan per tonne from Wednesday’s close of 105,130 yuan per tonne.
This was followed by a 0.4% increase in the June tin contract to 134,580 yuan per tonne and 0.3% gains in the April copper and zinc contracts to 45,860 yuan per tonne and 17,125 yuan per tonne respectively. The April lead contract edged up by 0.1% to 14,210 yuan per tonne, while aluminum gave the worst performance of its complex with its March contract declining by 0.2% to 13,715 yuan per tonne.
The generally positive performance comes amid a recovery in market confidence following Chinese authorities’ attempts to shore up the country’s economy with liquidity injections earlier in the week amid the ongoing novel coronavirus (2019-nCoV) outbreak.
On Tuesday, China’s Ministry of Finance allocated 1.848 trillion yuan of a new local government bond quota, much earlier than in previous years, to help local authorities offset the negative impact of the coronavirus and stabilize a slowing economy.
More broadly, risk sentiment was supported by reports that the coronavirus is starting to peak in China amid ongoing containment efforts.
“Yesterday saw the number of new cases decelerate for the second time in a row, while in Hubei new cases have fallen for an eight day in a row. That could mean the virus is starting to peak in China with containment efforts working, though it is still very early and the [World Health Organization] are urging ‘extreme caution’,” Tapas Strickland, director of economics at National Australia Bank, said in a morning note.
“Also encouraging is that there appears to be little evidence of sustained virus transmission outside of China,” Strickland added.
- The dollar index, which gauges the strength of the US dollar against a basket of foreign currencies, was up by 0.05% at 11.31 am Shanghai time, at 99.01.
- The Shanghai Composite Index was down by 0.53% at 2,911.35 as at 11.30 am Shanghai time.
- In data on Wednesday, the Conference Board’s leading economic index for the United Kingdom in December 2019 was unchanged at 91.3.
- Crude oil inventories in the United States rose more than expected in the week to February 7 with an increase of 7.5 million barrels, much more than the 3.1-million-barrel increase that had been forecast.
- US data on Thursday includes the consumer prices and unemployment claims, both key indicators of economic health.