SMM Feb 23 News:
Review of Holiday Performance: During the Chinese New Year break, LME zinc's price center first declined and then rose. The 40-day moving average consistently supported the daily candlestick of LME zinc. After opening, the price center of LME zinc pulled back, hitting a low of $3,253/mt before rebounding steadily. Overall, the price center recovered, and as of Friday's close, LME zinc settled at $3,378/mt, up $35.5/mt for the week, a gain of 1.06%. LME zinc inventory stood at 101,575 mt, down 650 mt from pre-holiday levels, with the decline mainly from Singapore warehouses. Trading was sluggish during the holiday. At the start of the week, a stronger US dollar weighed on nonferrous metals, but subsequent bargain-hunting emerged during the holiday. The US Supreme Court's ruling against large-scale tariffs also provided macro tailwinds, boosting sentiment in the commodity market. Coupled with persistently low LME zinc ingot inventory, these factors drove a continuous rebound in LME zinc's price center.
Post-Holiday Outlook: From a macro perspective, the tariff ruling has led to a softer US dollar index, but overseas geopolitical risks remain, sustaining macro uncertainties. On the fundamentals, February coincides with the Chinese New Year break, with some smelters undergoing maintenance during the holiday. SMM expects domestic refined zinc production to decrease by approximately 50,000 mt MoM, indicating a weakening supply side. However, downstream enterprises also halted operations for the holiday. It is understood that most domestic zinc downstream plants plan to resume production on a large scale after the Lantern Festival. Overall demand weakened more significantly, and domestic zinc ingot inventory is expected to continue building up during the holiday. Fundamental support for zinc prices may weaken, and subsequent attention should be paid to post-holiday downstream production resumptions, holiday inventory buildup, and macro guidance.
(The above information is based on market collection and comprehensive evaluation by the SMM research team. The information provided in this article is for reference only. This article does not constitute direct advice for investment research and decision-making. Customers should make cautious decisions and should not replace their independent judgment with this information. Any decisions made by customers are not related to SMM.)
