China's Zinc Ingot Inventory Recorded an Increase, Weak Consumption Dragged Down Zinc Prices [SMM Zinc Morning Comment]

SMM, June 16:

Overnight, LME zinc opened at $3,591/mt, then fluctuated upward, hitting a high of $3,623/mt before pulling back all the way, dipping to a low of $3,568/mt during the session, and finally closed up at $3,584.5/mt, up $1.5/mt, or 0.04%. Trading volume decreased to 11,715 lots, and open interest increased by 4,047 lots to 246,000 lots. Overnight, LME zinc formed a bearish candlestick, with support from the 5-day moving average below. The US and Iran reached a memorandum of understanding, macro sentiment continued to improve, coupled with persistently low LME zinc inventory, LME zinc fluctuated at highs.

Overnight, the most-traded SHFE zinc 2608 contract opened at 24,840 yuan/mt. After opening, SHFE zinc moved sideways around the daily average line, hitting a high of 24,860 yuan/mt during the session. Near the end of trading, it dipped to a low of 24,785 yuan/mt, finally closing down at 24,820 yuan/mt, down 55 yuan/mt, or 0.22%. Trading volume decreased to 21,904 lots, and open interest increased by 761 lots to 79,941 lots. Overnight, SHFE zinc formed a bearish candlestick, with support from the 40-day moving average below. The US-Iran deal boosted macro sentiment, but on the fundamentals side, China's zinc ingot inventory recorded a slight increase again, and weak consumption dragged on zinc price performance. Amid the tug-of-war between longs and shorts, SHFE zinc is expected to fluctuate at highs.

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