SHFE zinc continued to decline in the night session, dragged down by LME trends [SMM zinc morning comment]

SMM, October 15:

Overnight, LME zinc opened at $3,725/mt, then drifted higher throughout the session, touching an intraday high of $3,765.5/mt before retreating from highs. Near the close, LME zinc dipped to $3,706.5/mt, ultimately settling down at $3,715.5/mt, down $1.5/mt, or 0.04%. Trading volume decreased to 11,184 lots, while open interest rose by 1,577 lots to 260,000 lots. Overnight, LME zinc formed a bearish candlestick, with support from the lower Bollinger Band. Strong US September CPI data reignited expectations for US Fed interest rate hikes, pushing the US dollar index higher and weighing on base metals. Additionally, LME zinc inventory accumulated again to above 140,000 mt, and with bears adding positions, LME zinc's center continued to shift lower.

Overnight, the most-traded SHFE zinc 2612 contract opened at 25,690 yuan/mt, then drifted lower throughout the session, touching an intraday high of 25,765 yuan/mt in early trading and an intraday low of 25,540 yuan/mt near mid-session. It ultimately settled down at 25,580 yuan/mt, down 45 yuan/mt, or 0.18%. Trading volume increased to 43,010 lots, while open interest rose by 4,222 lots to 101,000 lots. Overnight, SHFE zinc formed a bearish candlestick, with support from the lower Bollinger Band. Weakness in LME continued to drag on SHFE, and SHFE zinc extended its decline in the night session. The zinc ingot export window closed again, and zinc ingot inventory remained at a relatively high level. SHFE zinc is expected to remain in the doldrums in the short term.

Data source statement: Except for publicly available information, all other data are processed by SMM based on public information, market communication, and SMM's internal database models, and are for reference only and do not constitute investment advice.