LME Drove SHFE Higher, SHFE Zinc Center Shifted Upward [SMM Zinc Morning Comment]

Overnight, LME zinc opened at $3,340.5/mt. Early in the session, LME zinc briefly dipped to a low of $3,336.5/mt before bulls increased their positions, driving LME zinc to fluctuate upward throughout the session. It touched a high of $3,414/mt during the night session and ultimately closed up at $3,400/mt, gaining $60/mt or 1.8%. Trading volume rose to 12,425 lots, and open interest increased by 1,955 lots to 217,000 lots. Overnight, LME zinc posted a large bullish candlestick. Prospects for new negotiations between the US and Iran appeared favorable, easing market concerns. Non-ferrous metals rose broadly, and expectations of weakening zinc ingot supply outside China supported LME zinc's center shifting higher. LME zinc is expected to mainly fluctuate at highs today.

Overnight, the most-traded SHFE zinc 2605 contract opened at 23,850 yuan/mt. Early in the session, it briefly dipped to a low of 23,840 yuan/mt before bears reduced their positions, pushing SHFE zinc's center higher to touch a high of 23,970 yuan/mt. It ultimately closed up at 23,900 yuan/mt, gaining 185 yuan/mt or 0.78%. Trading volume fell to 47,019 lots, and open interest decreased by 1,040 lots to 71,016 lots. Overnight, SHFE zinc posted a small bullish candlestick. Macro sentiment continued to improve, and LME showed strong performance, driving SHFE higher. SHFE zinc is expected to mainly fluctuate at highs today.

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