At the close of the day session, domestic base metals were broadly lower, with only Shanghai nickel finishing in positive territory, gaining 0.25%.
Shanghai tin led the declines, falling 6.62%, while Shanghai copper dropped 1.54%. Losses for other metals were contained below 1%.
The alumina main contract rose 0.83%, while the cast aluminum main contract fell 0.52%.
Additionally, the lithium carbonate main contract gained 0.84%, and the polysilicon main contract edged up 0.14%. The industrial silicon main contract increased by 0.23%.
The European container freight main contract surged 9.23% to 4000 points.
In the ferrous sector, most products declined except for stainless steel, which rose 0.14%. Iron ore fell 0.78%.
Hot-rolled coil and rebar saw minor losses. In the coking sector, coking coal dropped 1% and coke fell 1.46%.
In overseas markets, as of 15:05, base metals were mostly lower. LME tin led the downturn with a 2.94% drop.
LME copper and nickel both advanced, with copper up 0.25% and nickel gaining 0.16%. Declines for other metals were under 1%.
In precious metals, as of 15:05, COMEX gold fell 0.98% and COMEX silver dropped 2.8%.
Domestically, Shanghai gold declined 3.67% and Shanghai silver plunged 8.83%.
Furthermore, the platinum main contract fell 5.49% and the palladium main contract dropped 5.89%.
Key futures data as of approximately 15:05.
Domestic Macro Developments
At a State Council policy briefing, the Vice Minister of Housing and Urban-Rural Development stated that localities should utilize central fiscal funds, local government special bonds, and credit funds effectively.
He emphasized fully leveraging market mechanisms, actively attracting social capital participation, and encouraging private enterprises to engage in urban infrastructure construction and operation to build a sustainable investment and financing system.
At the same briefing, the Director-General of the Ministry of Natural Resources' Territorial Spatial Planning Bureau indicated that innovative land-use support policies will be implemented.
The policy prioritizes utilizing existing land stock, with commercial projects directed to use such land first. New land supply will focus on guaranteeing municipal infrastructure.
In response to market concerns about pressure from revitalizing existing assets, the Ministry has introduced transitional policies.
The People's Bank of China conducted a net injection of 207.5 billion yuan via open market operations today.
The central bank conducted 218.5 billion yuan in 7-day reverse repos, with 11 billion yuan maturing, resulting in the net injection.
The central parity rate for the yuan was set at 6.8198 per US dollar on June 8.
US Dollar and Federal Reserve Outlook
As of 15:05, the US dollar index rose 0.03% to 100.1.
Economists at a major investment bank stated they no longer expect the Federal Reserve to cut interest rates this year due to a stronger-than-anticipated labor market.
The bank has pushed back its expectations for the final two rate cuts from December 2026 and March 2027 to June and December 2027.
However, the bank's chief US economist noted that the likelihood of Fed rate hikes remains low, as inflation "seems unlikely to become self-sustaining."
May's US employment growth exceeded all expectations, demonstrating labor market resilience and increasing market bets that the central bank might raise rates.
The bank continues to view a rate hike as unlikely but has raised its probability for a small hike from 10% to 20%.
Its baseline forecast still anticipates two 25-basis-point cuts next year, but the probability has been lowered from 40% to 30%.
The bank also lowered its forecast for the US unemployment rate this year from 4.6% to 4.4%.
The head of economics at another financial group maintained the firm's baseline expectations for the Fed's rate path following last Friday's strong non-farm payrolls report.
He said, "As we have emphasized for some time, we believe the Fed's next move will be a rate hike, with a baseline timing of the first quarter of 2027."
Risks to this outlook have shifted towards a potential earlier hike, with markets currently pricing in a possibility for the fourth quarter of 2026.
The Fed's rhetoric in the coming weeks may continue shifting from a bias towards cutting rates to a bias towards hiking.
Markets are awaiting US inflation data due Wednesday, which will influence expectations for the Fed's June interest rate decision.
Analysts at a European bank stated in a report that the case for a rate hike has looked significantly stronger than for a cut for some time, and last Friday's stronger-than-expected jobs report greatly reinforced this view.
Key Data and Events Ahead
Data scheduled for release includes Switzerland's May consumer confidence index, the Eurozone's June Sentix investor confidence index, and the US New York Fed's one-year inflation expectations for May.
Market participants are also monitoring a State Council policy briefing regarding the "15th Five-Year Plan" for urban renewal.
Crude Oil Market Dynamics
As of 15:05, oil prices on both major exchanges surged over 4%, with US crude up 4.38% and Brent crude gaining 4.71%.
The sharp price increase was driven by escalating geopolitical tensions between Israel and Iran, which have also stalled negotiations.
The president of an oil consultancy noted that the weekend's escalation in conflict between Israel and Iran once again showed the market how fragile any ceasefire is.
Intensified hostilities bring greater geopolitical risk, including the potential for the Strait of Hormuz to remain closed longer than expected, alongside rising chances of Iran taking additional measures to restrict Red Sea shipping.
The chief investment officer of a capital firm stated that the market had previously underestimated the significant remaining differences between the relevant parties and has been vacillating between pricing in the possibility of a deal and pricing in reality.
He added that even if a peace agreement is reached, multiple obstacles would hinder a swift normalization of oil flows.
These obstacles include the need to clear mines in the Strait of Hormuz, the potential need for months to restart closed oil fields, and repairs required for energy infrastructure damaged by drone and missile attacks.
According to a communiqué released after Sunday's OPEC+ meeting, seven countries within the framework decided to increase their combined crude oil production ceiling by 188,000 barrels per day starting in July.
The communiqué stated that countries reaffirmed the importance of a cautious approach and maintaining full flexibility to increase, pause, or reverse the process of voluntary production adjustments.
With a deal to allow oil tanker passage through the Strait of Hormuz remaining elusive, global oil inventories are falling to dangerously low levels.
Industry executives and analysts warn that another oil price shock, severe enough to ripple through broader financial markets, could occur in the coming weeks.
Analysts at a major US bank predict oil prices could rise rapidly by late June unless normal passage through the strait resumes.
US crude inventories have fallen for eight consecutive weeks, reaching their lowest level since February 2024.
Analysts point out that the risk of a second price shock is real, potentially stemming from the exhaustion of buffer mechanisms rather than the strait's closure itself.
Investors view the Strait of Hormuz as a persistent geopolitical bottleneck, suggesting that even if tensions ease, oil prices are unlikely to fall back below $70 per barrel.
Higher oil prices pose a "moderate headwind" to the US economy, but Europe and Asia are more vulnerable to sustained energy inflation.
If oil rises to $120 per barrel and stays there for a year, US economic growth could slow by approximately 0.4 percentage points.
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