Risk Warning and Trading Recommendations for the May Day Holiday Financial Futures [Equity Index Futures] Following a month-long rebound, the Shanghai Composite Index has returned to around 4100 points. Several factors may lead to increased volatility at the index level: First, special attention should be paid to the disclosure of listed companies' performance reports in late April. As per convention, companies with weaker results often release their reports during this period. If leading companies within a sector report earnings below expectations, it could trigger adjustments among stocks in that sector. Furthermore, trading activity in some sectors is highly concentrated. If subsequent incremental capital is limited or expectations reverse, short-term volatility in these sectors may intensify. Second, global equity markets have rebounded due to easing geopolitical tensions. Currently, global markets appear desensitized to changes in the geopolitical situation. If the US and Iran reach an agreement, funds that previously speculated based on expectations of de-escalation may choose to take profits. Conversely, if the situation becomes unstable again or remains unresolved, the market's optimistic expectations regarding its evolution may be revised. Attention should be paid to the linkage between domestic and international markets. Third, during the first quarter, the Shanghai Composite Index faced significant resistance above 4100 points. In the short term, monitor the pressure from trapped positions near and above 4100 points, as well as signals from the flows of major index ETFs. For the remaining trading days this week, with the approaching May Day holiday, some funds may choose to realize gains before the holiday to avoid uncertainty from news during the break.
[Treasury Bond Futures] Since April, long-term bonds have experienced a rally driven by loose liquidity conditions and buying from allocation accounts. The overnight repo rate among banks once fell to around 1.2%. Coupled with the central bank's continued minimal operations in the open market and the smaller-than-expected MLF rollover this month, concerns have emerged that money market rates may struggle to decline further, leading some to realize floating profits. In reality, the central bank's announcement emphasized that its supportive stance on liquidity remains unchanged. However, considering the upcoming Politburo meeting at month-end and the pressure from tightening funds due to month-end and holiday factors, a slight increase in short-term money market rates cannot be ruled out. Geopolitically, the US-Iran conflict has entered a phase of fighting and talking simultaneously, making it difficult for market risk appetite to improve significantly. The future path of the situation is unpredictable. Against the backdrop of an unchanged accommodative monetary policy stance, the value of bond allocations remains. Since April, against the background of pressure to reduce high-interest deposits, the scale of wealth management products has grown, pushing money market rates lower. Short-term bond yields fell first, followed by long-term bond yields catching up on the decline as inflation expectations cooled. The spread between 30-year and 10-year government bonds remains at a historically high level, suggesting potential for further yield curve flattening. Considering short-term liquidity fluctuations and medium-term fundamental support, it is advisable to consider establishing long positions in long-term bonds on any adjustments.
Precious Metals Since April, precious metals have shown a pattern of wide fluctuations, initially rising before falling. In terms of influencing factors, marginal changes in the geopolitical situation continue to significantly impact prices, particularly as the negative correlation between precious metal prices and oil prices remains evident. Currently, although ceasefire talks have begun between conflicting parties in the Middle East, progress is very slow, and the core issue of Strait navigation remains unresolved. Consequently, oil prices continue to fluctuate at high levels, and the 10-year US breakeven inflation rate has hit new highs, indicating persistent market concerns about inflation. On the other hand, repeated reassurances from US President Trump have somewhat reduced the tail risks of conflict, but the unresolved core issues will continue to cause market sentiment to waver. Notably, potential emergency gold sales for liquidity replenishment may still occur sporadically in some emerging economies, especially if the Strait remains blocked.
Looking ahead, particularly during the holiday period, uncertainty for precious metals mainly stems from two sources: first, geopolitical uncertainty, where the progress of negotiations will significantly influence market sentiment; second, uncertainty in US economic data, with "hard data" such as March PCE and Q1 GDP to be released during the holiday, likely causing some market volatility.
Overall, whether gold can resume its upward trend is key to the sector breaking out of its consolidation phase. Considering the current geopolitical stalemate, from a macro perspective, the narrative of global order restructuring will continue to support gold prices through its monetary attributes. Although the aforementioned emergency sales create short-term selling pressure, they do not alter the medium to long-term logic. Conversely, inflation concerns and tightening liquidity triggered by geopolitics present headwinds from a financial attribute perspective, but their negative impact on precious metals has been diminishing. Strategically, approaching the May Day holiday and given persistent geopolitical uncertainty, it is recommended that leveraged traders primarily reduce positions. For those holding positions over the holiday, gold is the preferred choice.
Energy and Chemicals [Crude Oil] The US-Iran conflict has persisted for two months, with this geopolitical factor continuously dominating volatility in the crude oil market. The crucial Strait of Hormuz remains disrupted. Recent developments suggest potential for talks between the US and Iran, but the foundation for negotiation remains weak. Iran recently proposed a three-phase negotiation plan: first, a complete ceasefire; second, discussions on managing the Strait of Hormuz; and finally, talks on nuclear issues. As the Strait disruption prolongs, the impact on market supply shortages intensifies, increasing upside risks for oil prices. Currently, Brent crude is trading above $100 per barrel, with intraday volatility also increasing, indicating persistently high market risk. Traders are reminded to control risks during the holiday and consider closing positions.
[Fuel Oil] The market structure for high-sulfur and low-sulfur fuel oil has weakened recently. Specifically: For low-sulfur, rising freight rates have hurt East-West arbitrage economics, and geopolitical conflicts have disrupted resource flows from the Middle East. Low-sulfur fuel oil arrivals from Western markets are expected to decline for the third consecutive month in April. However, weak downstream bunker fuel demand has been suppressing the market. For high-sulfur, while near-term supply appears ample, shortages may emerge in the second half of April. As the East-West spread for 380 CST high-sulfur fuel oil has narrowed from its peak in the initial weeks after the conflict erupted, high-sulfur arbitrage arrivals from the Americas in May are expected to decrease compared to April. Arrivals from Russia have already decreased due to previous attacks by Ukraine. A wait-and-see approach is recommended.
[Asphalt] Expectations regarding the reopening of the Strait of Hormuz have been volatile, leading to significant fluctuations in oil prices, directly impacting asphalt production costs. Tight supply of Iranian crude affects domestic refineries reliant on Iranian heavy oil. Coupled with the cessation of Venezuelan resource flows to China, asphalt production has declined. Refinery planned production for May is down over 50% year-on-year. However, high asphalt prices have delayed demand, with recent demand down over 30% year-on-year. If the conflict persists, asphalt could face significant shortages during the peak season. It is advised to monitor subsequent developments in the conflict, as the market has entered a phase of high unpredictability.
[Olefins Chain] Plastics: Spot prices have edged down, with the nearby month basis near parity. Due to recurring geopolitical tensions, crude oil remains in a high-volatility phase. Chemical products are weak. Fundamentally, upstream and midstream inventories are drawing down but remain high compared to previous years. Domestic downstream demand follow-through is poor, while exports hit a record monthly high. Unilaterally, the price center for plastics is trending downwards. Risks stem from renewed geopolitical tensions. The holiday period is long, and uncertainties remain between the US and Iran. Pay attention to position risks.
PP: Spot prices weakened slightly before the holiday, with basis in contango and calendar spreads retreating. On the cost side, crude oil and propane are fluctuating as geopolitical tensions have not intensified further. Chemical products are weaker relative to crude. Fundamentally, domestic downstream demand is weak, with low purchasing willingness and poor order follow-through. However, export profits and volumes have reached record highs. Apparent demand growth in Q1 was negative. Inventory-wise, upstream and midstream are destocking periodically. Barring a renewed deterioration in the geopolitical situation, the price center is expected to gradually shift lower. Considering uncertainties during the holiday, light positions or hedging are recommended.
Propylene: Spot prices are relatively firm, with basis maintaining a deep contango. The most significant positive fundamental factor is the sequential decline in PDH operating rates, which are at historically low levels. Domestic production is expected to decrease by 100,000-150,000 tonnes this month. Imports are expected to decrease by 100,000 tonnes, leading to an overall supply reduction of over 200,000 tonnes in April. Other fundamental factors are negative, including record-high inventories and a continued, significant decline in downstream demand operating rates. Crude oil on the cost side is the biggest risk point during the holiday. Caution and light positions are advised.
[Polyester Chain] Polyester operating rates have decreased sequentially. Terminal weaving orders are below expectations, but finished goods and raw material inventories at the terminal are low, suggesting potential restocking demand later, pending stabilization of raw material prices.
PX: On supply and demand, domestic operating rates have stabilized recently, with maintenance planned for May—execution needs monitoring. Domestic finished product inventories are high; monitor the progress of reducing oil output and increasing chemicals. Conflicts have led to reduced operating rates at Japanese and Korean refineries, potentially affecting imports. Valuation-wise, the naphtha spread has retreated from recent highs, while PXN has recovered from lows. Overall PX valuation is neutral to偏高. In summary, PX supply and demand are slightly tight in the short term, with significant destocking expected in Q2. If the conflict persists, subsequent supply recovery may fail to materialize. Therefore, closely monitor developments in the Middle East. Until geopolitical tensions cool, a cautiously bullish view on PX is maintained, favoring long positions on deferred contracts.
PTA: On supply and demand, some plants have scheduled maintenance in April-May; monitor whether more units might shut down due to PX shortages. On the demand side, polyester operating rates are lower year-on-year due to soaring raw material costs. Terminal weaving operating rates and orders are also suppressed. However, if tensions ease or oil prices stabilize, a wave of restocking demand might emerge. Valuation-wise, PXN has recovered somewhat from lows, and the PTA processing spread is oscillating at low levels. The overall PTA-to-crude valuation is neutral to偏高. In summary, PTA is in a tight balance short-term, with destocking expected in May-June. Also monitor potential further plant shutdowns due to PX shortages. In absolute terms, supported by strong raw materials, PTA is also trending stronger. Focus on long positions on deferred contracts.
MEG: On supply and demand, operating rates held steady this week. Petrochemical rates are stable; monitor potential further reductions. Coal-chemical rates are high, and current high profits may curb maintenance intensity in Q2. Geopolitics have caused significant supply losses in the Middle East, which will manifest as reduced imports. Other Asian plants are reducing rates due to feedstock shortages. Overseas MEG prices have surged, leading to price inversions between import and export prices. On the demand side, polyester operating rates have decreased, and terminal orders are weak short-term. Monitor potential restocking demand after mid-to-late May. Overall, supply loss exceeds demand loss, leading to significant MEG destocking in Q2. Valuation-wise, coal-chemical profits have surged, while petrochemical profits have fallen sharply. Absolute prices remain strong recently; consider buying on dips.
PF: On supply and demand, short-term operating rates have decreased slightly sequentially. Short-term demand is suppressed by high raw material prices, but restocking demand might emerge if geopolitical tensions cool and oil prices stabilize. Inventory held steady with a slight decrease this week. Profits, at low levels, have improved slightly recently. Absolute prices are trending stronger, following raw materials.
PR: On supply and demand, bottle chip operating rates have decreased slightly sequentially, remaining low overall. Continue monitoring the progress of the Middle East conflict and the recovery of domestic bottle chip operations; low operating rates may persist short-term. Demand enters the peak season gradually in Q2. Valuation-wise, the spot processing spread strengthened significantly recently before stabilizing. Absolute prices for bottle chips also remain strong.
[PVC] On supply and demand, supply continues to decrease, while demand is recovering seasonally. Inventory and exports remain high. The cancellation of Indian tariffs is expected to further boost exports in Q2. Medium to long term, focus on global supply reduction and the extent of domestic inventory drawdowns. News regarding Strait navigation remains volatile. Crude oil is still fluctuating at high levels. The logic of rising PVC costs and reduced supply persists. The futures market has stabilized and risen, suggesting a cautiously bullish view. Reduce positions ahead of the holiday.
[Methanol] Domestic operating rates are expected to recover later but will continue to run at high levels. Malaysia's #2 plant is shut down, but multiple Iranian plants are restarting or planning to restart, suggesting a recovery in operating rates later. Ningbo Fulde has reduced rates, Qinghai Salt Lake has restarted, while Zhong'an and Xingxing remain shut down. Traditional downstream operating rates are mixed. Coastal inventories accumulated unexpectedly previously but are expected to draw down later, while inland inventories continue to decrease. Currently, the US and Iran are in a negotiation phase, with both sides using the blockade of the Strait of Hormuz as a bargaining chip. Crude oil prices are volatile but strengthening. However, the market still believes talks and logistics normalization are probable, limiting chemical products' follow-on gains. Methanol imports arriving in China remain limited. Although Iranian plants are restarting, future imports depend on Strait logistics. Downstream profits are poor, and operating rates are declining. Some delivered goods from the 2604 contract have entered the market, easing the tight supply-demand balance temporarily. However, exports increased in April. Downstream restocking demand remains before the May Day holiday. Additionally, high basis still supports prices. Methanol is expected to maintain high volatility short-term. Later, closely monitor changes in the Middle East situation and domestic supply-demand dynamics.
[Soda Ash] Spot price is 1180 yuan/ton. Supply-demand pressure is higher than last year. Cost range is 1100-1300 yuan/ton; high costs lead to losses. Prices are bottoming out. Futures are at a premium; a slight downward trend to close the basis gap is expected long-term. Monitor potential short-term positives from the exit of loss-making capacity and policies like efficient coal use. Monitor positives from European production cuts and increased Chinese exports. The impact of India's zero tariff on Chinese exports is limited. The futures market is slightly stronger but lacks strong drivers. A wait-and-see approach is recommended.
[Glass] Spot price is 970 yuan/ton. Shahe ignited a 1800t/d furnace. Daily melting capacity is 145k tons. Current supply and demand are roughly balanced. Downstream raw material inventories are low, suggesting potentially strong restocking during the peak season. Upstream and midstream inventories are high. Supply-side uncertainty is significant, putting pressure on price increases. In a weak supply-and-demand environment, prices are at low levels. Medium-term, monitor positives from fuel structure adjustments in production lines. Short-term futures have stabilized but face upward pressure. A wait-and-see approach is recommended during the holiday.
[Caustic Soda] Spot prices are weak. Existing inventory is neutral to slightly high, with manageable pressure. Seasonal expectations of "reduced supply, increased demand" are strong. Prices are volatile but偏强. Liquid chlorine is strong. ECU profits are neutral but highly volatile, offering limited reference value. The futures market has stabilized. Downstream caustic soda demand is expected to restock around May Day. The market is volatile but偏强. Exit positions before the holiday.
Agricultural Products [Sugar] The US-Iran conflict is volatile, causing wide swings in oil prices. Under El Niño expectations, production prospects in major producing countries have been revised down to varying degrees, reducing远期 supply pressure. After May Day, Brazilian crushing will accelerate. The sugarcane crush mix, Indian and Thai export dynamics will guide the market. Domestic crushing is ending, and peak season procurement is approaching. El Niño expectations are strengthening. The tension between short-term inventory pressure and long-term buying value will become clearer in May. Post-holiday, focus on production pace and inventory drawdown progress.
[Eggs] Inventory rebuilding is nearing its end. Spot prices are stabilizing and有望 to rise again. Last week, hen molting age showed signs of delay; this week, culling age remains unchanged. Futures clearly show fund-driven behavior dominated by bulls in the 2607 and 2608 contracts, avoiding short positions in nearby months. Nearing May Day, volatility is increasing. With futures at a discount, a unilateral decline is difficult. April is basically over. Maintain the view that the 2607 and 2608 contracts are strong. The market shows a positive spread structure. Trading difficulty has increased. Emphasize risk management.
[Live Hogs] The current rebound in the live hog market is primarily driven by reduced slaughter volume and pre-holiday stocking sentiment. The fundamental supply-demand situation has not reversed. In May, the industry is still realizing the high productive sow capacity from earlier periods. Slaughter weights remain high, and supply pressure has not substantially eased. Simultaneously, post-holiday consumption is expected to decline. Monitor the price fluctuation range after supply-demand rebalancing in May, and the impact of secondary fattening activities on short-term trends. Futures faced significant pressure after a阶段性 surge, lacking sustained upward momentum, but the probability of a sharp decline is also small. For nearby months, watch the path of basis convergence. For deferred months, monitor whether capacity reduction accelerates. The May Day holiday is long; light positions are recommended.
[Apples] Spot market is in the off-season, with slow inventory drawdown. The 2610 contract continues to see significant open interest increases. The market has become insensitive to weather-related trading. Until the spot market improves, the trend points towards the 7500 integer关口. Treat the market as weak.
[Jujubes] The spot market is weak during the off-season. The 5-9 spread narrowed again. Spot traders will oscillate between the 2605 and 2609 contracts. Today (April 27), after a general pullback in agricultural products, jujube futures also weakened under quantitative driving forces. Fundamentally, there is no clear driver above 9100 yuan/ton for the 2609 contract. Therefore, the recent rebound is not industry-driven. However, considering the absolute low-price range, it is recommended to observe more and participate less.
Non-Ferrous Metals [Copper] In Q1 2026, the Shanghai copper主力 contract surged before retreating震荡 due to the Middle East conflict, returning above the 100,000 yuan/ton mark in mid-April. LME copper同步 broke through $13,000/ton, maintaining operation within a historically high range. Supply-side disruptions persist, with mine output reductions in Indonesia, Panama, Democratic Republic of Congo (DRC), and Chile. Copper concentrate treatment charges are low. Sulfur shortages are causing contraction in overseas smelting capacity. Global copper raw material supply is tight. Demand relies on support from new sectors like new energy, energy storage, and computing power. However, photovoltaic consumption faces downward pressure in 2026. Approaching May Day, the copper market features持续强化 supply constraints, intertwined structural demand support with short-term weakness, and intensified macro disturbances. The medium-to-long-term bullish logic remains intact, but risks are concentrated in the short term under high copper prices: slowing destocking, fading sentiment, and demand falling short of expectations. Heightened vigilance is required.
[Tin] The resumption process of Myanmar's tin mines remains slow due to pumping operations and material approval issues. Additionally, geopolitical conflicts in the DRC remain uncertain. Indonesia's ongoing tightening of export controls on the extended tin产业链 continues. Currently, during the RKAB approval period, refined tin exports dropped significantly in April, intensifying raw material tightness expectations. On the consumption side, the traditional peak season is ending, but some downstream photovoltaic, electronics, and home appliance firms still have rigid procurement needs. Although high prices suppress bulk purchasing, consumption of刚性需求 has driven a slight inventory drawdown. Tin prices are approaching the significant resistance level of 400,000 yuan/ton. Be cautious of macro risks during the holiday suppressing prices.
[Zinc] Recent expectations for mine supply growth have been significantly revised down. Imported treatment charges turned negative in April. Domestic zinc concentrate supply is tight. However, due to high sulfuric acid prices, by-products continue to supplement domestic smelter profits. No significant production cuts have occurred domestically yet. Domestic treatment charges are also showing signs of decline. Rising overseas energy costs keep the risk of overseas smelter reductions alive. Persistently low LME zinc inventories support LME zinc's strength. Expectations for the opening of the zinc ingot export window could boost domestic prices, pushing SHFE zinc higher阶段性. On the demand side, domestic consumption is平淡 under high prices. Zinc ingot inventory drawdown is relatively slow, and inventory pressure caps upside potential. Around May Day, zinc prices are expected to continue窄幅震荡 under the dual influence of cost support and weak demand. Given the relatively long holiday and intensified macro uncertainty, light positions and a wait-and-see approach are recommended.
[Aluminum & Alumina & Aluminum Alloy] Primary Aluminum: On the supply side, domestic operating capacity is nearing its ceiling. Overseas production has been significantly revised down due to Middle East conflicts. On the demand side, domestic inventories have not decreased, while overseas inventories continue to draw down (weak domestic, strong overseas). The supply-demand deficit is expected to widen. Later, the market may shift to trading the actual deficit, which requires demand verification. Monitor whether smooth transmission of domestic aluminum product exports leads to domestic inventory drawdowns. Alumina: Short-term supply and demand have tightened. Later, with the release of new capacity and the restart of some facilities after accidents in Southwest China, operating capacity will recover. This is a window period for Guinea's bauxite policy; close monitoring is essential. If policy收缩 exceeds expectations, raw material constraints will affect alumina production, and bauxite prices will rise. Coupled with预期的 "anti-involution" policies, these factors provide significant support for futures prices, especially deferred contracts. Nearby months are dragged down by大量 expiring warehouse receipts and will likely underperform deferred months. Aluminum Alloy: Scrap aluminum is tight, providing strong cost support, but demand is a significant drag, slowing inventory drawdown. Strategy: Primarily reduce exposure before the holiday to guard against overseas risks. Given the expected primary aluminum deficit, the price中枢 may抬升; consider buying on dips. Monitor the inflection point in domestic social inventories and geopolitical developments. For alumina, after a阶段性 rebound, consider testing shorts in nearby months or participating in a 6-9反套. A trend reversal requires clear signals of实质性的 supply-side capacity exit. Monitor domestic and international policy moves. Aluminum alloy trends still follow primary aluminum. Later, monitor the recovery of the automotive industry.
[Nickel] The rainy season in the Philippines' main mining areas has ended, leading to a seasonal increase in supply. However, Indonesia's nickel ore quotas are limited, keeping Indonesian ore supply tight and prices firm. Domestic nickel pig iron (NPI) prices rose intraday, slightly修复 NPI smelting profits. Downstream stainless steel mills maintain high production schedules; mill profits have略扩. Social inventories continue to draw down. The traditional industry chain performance is neutral. In the new energy sector, nickel sulfate production is based on sales orders, with production increasing sequentially. Inventories remain low. Terminal new energy vehicle sales growth is gradually recovering. For refined nickel, domestic production remains high, and inventories are at elevated levels. Current market positives include the impact of Indonesia's收紧 nickel ore quotas and rising intermediate costs for hydrometallurgical smelting due to sulfur supply tightness. Negatives include high inventory pressure. With both bullish and bearish factors present, the market lacks a clear trend. The impact of Indonesia's收紧 ore quotas is becoming apparent, boosting market sentiment. However, with the May Day holiday approaching, exiting positions to avoid overseas risks is recommended. Later, monitor whether large-scale production cuts occur in Indonesian hydrometallurgical plants and the approval status of Eramet's application for additional ore quotas.
[Stainless Steel] Nickel ore supply is tight, supporting firm prices. NPI prices have rebounded, providing strong cost support. Domestic production remains high, but inventories are drawing down, indicating a decent "Gold March, Silver April" performance. Mills are预计 to deliver significant volumes for May delivery. Short-term cost support, combined with relatively good supply-demand fundamentals, makes the futures market prone to rising rather than falling.
[Lithium Carbonate] Supply-side disruptions persist: Several Chinese companies in Zimbabwe have obtained export quotas, but the impact of the over-one-month export suspension is expected to be reflected in May's domestic lithium ore import data. Four lithium mines in Yichun published assessment reports for mining right transfer收益; the market expects these mines might suspend operations for license renewal. Due to geopolitical tensions, Australia faces diesel supply shortages, raising the possibility of Australian lithium mine suspensions due to fuel shortages. Smelting production increased weekly, with lepidolite production slightly down, while spodumene and salt lake production increased. Overall production remains high. On demand, cathode material plant production schedules increased sequentially. Terminal energy storage maintains growth. Terminal new energy vehicle production and sales are持续修复 but remain negative year-on-year. Inventory has been accumulating recently, though the pace is slowing. Breakdown shows trader inventory increasing, while smelter and downstream inventories are drawing down. Cost-wise, ore prices followed lithium salt price movements this week. Integrated profits are very substantial. According to the latest upstream and downstream production schedules, supply and demand continue to recover, maintaining a tight balance. Current prices are再次 near previous highs, facing significant resistance. Avoid chasing rallies. With the holiday approaching, avoid high volatility risks. Exiting positions is recommended. Later, continuously monitor supply-side disruptions and whether consumption shows new超预期 performance.
Ferrous Metals [Steel] Demand is recovering, and destocking has accelerated slightly. Additionally, the出台 of the low-carbon development action plan for manufacturing has revived expectations of supply contraction, favoring price rebounds. However, resistance is expected near 3200 yuan/ton. Pre-holiday restocking by downstream users is基本上 over. After May, closely observe sequential changes in demand. If demand turns downward, pressure from high spot inventories will materialize.
[Coal & Coke] Supply: Domestic coal production continues to increase. Mongolian coal通关量 is high. Seaborne coal import windows are open. Overall supply remains high with a trend towards further increase. Demand: Although the second round of coke price increases by coking plants was accepted, and spot coking coal transactions improved, limited room for short-term increases in blast furnace iron output (铁水) restrains overall upside potential. Steel mills intend to delay a third price hike. Inventory: Steel mill coke inventories are low. Coking plant coke inventories are also low. Mine coal inventories are low. Downstream pre-holiday restocking is基本上 over. Valuation: Futures are at a premium, creating some pressure; watch for short-term correction节奏. Overall, coke supply and demand are basically balanced; coking coal is slightly oversupplied. Prices are震荡运行, with the中枢 following energy prices higher. Monitor the impact of safety production themes.
[Iron Ore] Approaching the holiday, market volatility has narrowed. The overall industry chain has supportive factors. Valuation risk is moderate. The impact of earlier BHP negotiations has faded. Supply-side expectations have returned to normal shipping patterns and paths. Demand has阶段性 peaked and is expected to run steadily in the coming weeks. Before mid-May, port inventories are预计 to maintain a destocking trend. Short-term, the risk-reward ratio for outright long or short positions is not clearly advantageous. Implement breakeven/stop-loss measures if holding positions over the holiday. A wait-and-see approach is suggested.
Shipping Index The futures market is becoming increasingly desensitized to changes in the Middle East situation. The container shipping market primarily speculates on whether the expected June freight rate increase magnitude matches the discount priced into the futures. Traditionally, the shipping market is seasonally weak with loose supply-demand. To improve load factors, carriers have been slightly reducing rates since mid-to-late April to attract cargo. Market research indicates that, affected by holiday-related blank sailings, vessel space is tight around the May Day holiday. Some small and medium-sized freight forwarders and direct shippers face issues like no space, rate hikes, or forced consolidation. Direct bookings may only be available after the holiday in May, increasing the risk of rollovers. Exporters are advised to secure space at least one week in advance, ship during off-peak times, and allow buffer time for delays. High costs like oil prices in Q2, combined with the transition from the off-peak to peak season in May-June, are expected to gradually push up spot freight rates. However, the early May announced rate hikes may diverge from actual transaction rates, indicating insufficient price support strength. Coupled with the 2605 contract's narrow range and limited liquidity,现货 enterprises are advised to use the 2606 contract for hedging based on recent shipping plans. The index's current run has already priced in部分 of the carriers' rate hike expectations. Short-term, it is expected to remain range-bound. Strategy-wise, avoid chasing rallies in the 2606 contract单边 at high levels; monitor resistance at the 2250-2300 point range. Exporters can patiently wait for index pullbacks and look for opportunities to buy hedging in batches to lock in freight rates early. For spreads, profits on the 06-10正套 can be gradually taken off the table. Adopt light positions for the holiday and respond cautiously to market fluctuations.
Reminder There will be no night trading on the evening of Thursday, April 30, 2026. The market will be closed from Friday, May 1, 2026, to Tuesday, May 5, 2026. Trading will resume with a call auction for all commodity futures and options contracts from 08:55 to 09:00 on Wednesday, May 6, 2026, with night trading resuming that evening.
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