Macro sentiment is weak, SHFE zinc records a four-day losing streak [SMM Zinc Morning Comment]

Overnight, LME zinc opened at $3,599/mt. In early trading, after a brief consolidation near the daily average line, bears added positions to pressure prices, sending LME zinc fluctuating downward throughout the session. Approaching the night session, the price center shifted lower to around $3,490/mt, before edging slightly higher at the close to settle down at $3,501.5/mt, a decline of $100.5/mt or 2.79%. Trading volume increased to 19,100 lots, and open interest rose by 5,090 lots to 266,000 lots. Overnight, LME zinc formed a large bearish candlestick, finding support at the lower Bollinger Band. With heightened expectations for US Fed interest rate hikes, nonferrous metals and global stock markets fell, and the US dollar remained firm. LME zinc trended lower, with attention on support at the $3,440/mt level.

Overnight, the most-traded SHFE zinc 2608 contract opened lower with a gap at 24,385 yuan/mt, and remained in the doldrums near the daily average line. It touched an intraday high of 24,450 yuan/mt early in the session and a low of 24,290 yuan/mt, eventually closing down at 24,370 yuan/mt, a drop of 395 yuan/mt or 1.59%. Trading volume decreased to 61,497 lots, while open interest increased by 861 lots to 102,000 lots. SHFE zinc posted a four-day losing streak overnight, with the daily candlestick center shifting lower and the MACD bearish candlestick expanding. Under the influence of macro expectations for interest rate hikes, SHFE zinc’s center moved lower. However, with the SHFE/LME zinc price ratio remaining low, the zinc ingot export window is about to open. Attention should be paid to the actual subsequent export volume.

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