Tin was the worst performer of its peers in terms of percentage losses. The most-traded June tin contract fell to 119,050 yuan ($16,988) per tonne at the end of the morning session, down by 4,460 yuan per tonne or 3.6% from Tuesday’s close of 123,510 yuan per tonne.
“Tin’s fundamentals have been pretty bearish with long-lasting illiquidity. Exacerbating this is the virus-related rise in risk aversion,” a Shanghai-based analyst said.
This was reflected in the 7% day-on-day decline that the London Metal Exchange three-month tin price recorded at the close of European afternoon trading on Tuesday
, and at one point earlier in the day hit a five-year low.
Copper also recorded a significant fall on the SHFE this morning, with the red metal’s most-traded May copper contract down at 41,700 yuan per tonne, dropping by 930 yuan per tonne or 2.2% from Tuesday’s close of 42,630 yuan per tonne.
“Heavy selling hit the base metals, with [LME] copper posting its biggest two-day loss since 2015. Signs of weakening demand are emerging by the day. Inventories on the LME jumped 22% yesterday, pushing the year to date gain to over 50%,” Rahul Khare, analyst from ANZ Research said in morning note.
A fresh inflow of some 42,900 tonnes was delivered into LME-registered warehouses on Tuesday, with some 23,125 tonnes delivered into Busan and 13,225 tonnes into Kaohsiung.
“The fall in [copper] prices in getting a response from the supply side, with several top producers announcing cut backs to output,” Rahul Khare added.
Cerro Verde, the world's fourth-largest copper mine in output, will suspend operations and enter a 15-day care and maintenance period
following the Peruvian government declaring a national state of emergency, owner and operator Freeport McMoRan said on Tuesday.
The rest of the SHFE base metals were down at close of the morning session on Tuesday, with May lead at 13,400 yuan per tonne (-2.3%), May aluminium at 12,650 yuan per tonne (-0.7%), May zinc at 15,510 yuan per tonne (-1%) and June nickel at 99,480 yuan per tonne (-0.1%).
- The dollar index, which gauges the strength of the US dollar against a basket of foreign currencies, was at 99.28 as at 11.30am Shanghai time, up from a reading of 98.08 at a similar time on Tuesday.
- The Shanghai Composite Index was up by 1.26% at 2814.70 as at 11.30 am Shanghai time.
- Germany’s ZEW economic sentiment indicator plunged by 58.2 points month on month to -49.5 points today - the largest drop since the survey started in 1991 - in line with Germany's worsening economic situation due to the coronavirus outbreak in Europe.
- In data from the United States, month-on-month core retails sales have dropped 10 percentage points to -0.4% from 0.6% previously, while retail sales have performed similarly, dropping 11 percentage points to -0.5% from 0.6% in February.
- Data of note on Wednesday includes the European Union’s final consumer price index (CPI) and trade balance, while US releases include building permits, housing starts and crude oil inventories.