Last Friday, the Shanghai copper market ushered in a sharp rise in the night, the Shanghai copper index rose 1.84%, and once hit a high of 48,290 yuan / ton since July 22. The latest report of Jinrui Futures believes that the market operation logic mainly has the following points:

The number of new non-agricultural employment in November was 266,000, which greatly exceeded the market's expectations of 183,000, and market trading sentiment surged.

2. The risk appetite of the US stock market has recently recovered, and the market's worries about the US recession have also improved.

3. Since the interest rate cut at the end of October, the market expects the Fed to continue to lower interest rates. The Fed ’s final interest rate decision for the year next week is expected to maintain the current interest rate level.

4. The Political Bureau of the Central Committee of the Communist Party of China convened a meeting on December 6 and clearly stated that “using the tools of good counter-cyclical adjustments” to ensure the comprehensive completion of a well-off society and the successful completion of the “Thirteenth Five-Year Plan” and emphasized the construction of infrastructure. There will be marginal easing of fiscal policy to ensure growth, and the interest rate on government bonds rose slightly to 3.2% this week.

5. The supply of domestic scrap copper is still tight. According to the import and export data from Malaysia, Malays are accumulating a small amount of stock in the country. Some companies report that Malaysia's scrap copper inventory is high in stages, and currently many new copper scrap ingot production facilities have been released. Some production has been released. However, China's imports of crude copper data have not been reflected yet, and they will remain concerned in the later period.

6. Recently, due to the closure of the import window, inventories in the bonded zone have stopped falling, and the inflow to the mainland has shrunk. Domestic stocks continue to go out of stock, and the tight spot has led to an increase in domestic spot discounts.

7. From the survey results, some cable factories expect to improve their orders in real estate.

8. In addition, the current industrial inventory of the smelting and processing industry is nearing the bottom of the cycle, and future improvement in consumption is expected to drive demand for replenishment in the industrial chain. The current copper price market is concerned about the negotiations between China and the United States. Tariffs will be levied near 12.15. The progress of the negotiations between the two parties may accelerate, which will affect the short-term market sentiment fluctuations. It is cautiously optimistic about copper prices in the medium and long term.

China CITIC Securities pointed out that the Politburo meeting on the weekend analyzed 20 years of economic work and clearly stated that “use of good counter-cyclical adjustment tools”, this expression reaffirmed the importance of “counter-cyclical adjustment” in economic work in 2020. Since the middle of 2018, except for the real estate chain, the rest of the economic sectors have basically shown downward pressure. Once again, the background is to destock. At present, the stocks of plates and long products in copper, aluminum, zinc, and steel are relatively low. Although most varieties are not out of stock except for individual varieties, there is no need for a sharp rise in short-term fundamentals. However, if the “countercyclic adjustment” is taken into consideration, the economy in the first half of 2020 will be significantly boosted. Demand for non-ferrous metals such as copper, aluminum, and zinc may be boosted in the first half of 2020. Low inventory plus restrained supply, once As demand improves in stages, prices are expected to increase significantly. Copper, as the basic metal with the best long-term supply and demand fundamentals, is expected to fully benefit. Last Friday's LME copper price exceeded $ 6,000 also reflected this.