Lead highlights

摘要

Through April, LME lead prices continued their descent from their mid-February peak, lacking any notable support in the form of buying interest from either the trade or speculative communities. Major sell-offs in copper and aluminium, and weakness in sister metal zinc, also contributed to undermining the market, such that by the end of April three-month prices had even been driven below the 200-day moving average. This puts the scale of lead's downturn on a par with that of nickel, the only other metal to have breached, or indeed even approached, this level. Official LME three-month lead prices ended April at 718 dollars/tonne (32.6 cents/lb), a modest recovery from their year-to-date low of 699 dollars/tonne (31.7 cents/lb) a week earlier, but a far cry from February's record high of 933 dollars/tonne (42.3 cents/lb). If prices can continue to consolidate above 700 dollars/tonne (31.8 cents/lb) and confirm the formation of a floor here, a move higher will follow in due course, aided by a growing backwardation and extremely low LME stocks. However, we add the caveat that it will likely require gains in copper and aluminium, and the return of more bullish sentiment towards the base metals generally, before lead prices will make a decisive upward move.