Base metals trading on the Shanghai Futures Exchange ended higher on Wednesday as easing prospects by central banks continue help metal prices consolidate even as global growth prospects remain lackluster.
With latest Chinese GDP numbers released yesterday showing the full year 2014 GDP growth at 7.4 percent, the lowest in 24 years, investors are banking on more easing policies from the Chinese government, Fastmarkets reported Wednesday.
“The risk for China’s growth to dip below seven percent in the first half cannot be ruled out. From that perspective, we think the policy is likely to remain biased towards easing,” said economists at OCBC (Overseas Chinese Banking Corporation) Bank.
Asian equities climbed across the board barring Japan’s Nikkei 225, with the Shanghai Composite leading gains of 4.76 percent. The Hang Seng is up as well, gaining some 1.54 percent to 24,325.
Metals Market
In the metals market, base metals ended the Asian session mostly higher, led by gains in zinc and futures.
The active March zinc futures added 125 yuan to 16,155 yuan.
Lead futures trading on the SHFE gained 85 yuan to end at 12,575 Rmb, its highest since the start of the year.
The active March copper futures gained a slight 10 yuan to end at 41,260 yuan. Open interest were lower by about 10,000 contracts to 268,638.
Spot copper in Changjiang is also down 0.1 percent at Rmb 41,500-41,750, the backwardation with the futures is lower at an equivalent of $58 per ton and the LME/Shanghai copper arb ratio is around 1 to 7.29.
Aluminium futures stayed unchanged at 12,775 yuan, while open interest fell about 5,000 contracts to 128,830.
