SMM Zinc Market Morning Comment (July 24)

Overnight, LME zinc opened at $2,729/mt. After a brief rise at the beginning of the session, it peaked at $2,751/mt. Subsequently, as funds exited, LME zinc fluctuated downward, hitting a low of $2,667/mt during the night session. It then moved up to consolidate around $2,730/mt and finally closed lower at $2,702.5/mt, down $32/mt or 1.17%. Trading volume reduced to 13,569 lots, and open interest decreased by 2,431 lots to 220,000 lots. Overnight, LME zinc recorded a bearish candlestick, with LME zinc inventory increasing by 1,650 mt to 247,425 mt, an increase of 0.67%. Fundamentals show that LME inventory continues to rise. Although the supply of raw materials remains tight, actual demand is relatively average. With tight raw materials but ample ingot supply, LME zinc continued to decline and is expected to remain weak today.

Overnight, the most-traded SHFE zinc 2409 contract opened at 23,000 yuan/mt. At the beginning of the session, SHFE zinc quickly dipped to 22,805 yuan/mt. Subsequently, as shorts reduced their positions, SHFE zinc fluctuated upward, peaking at 23,060 yuan/mt, and finally closed lower at 23,020 yuan/mt, down 75 yuan/mt or 0.32%. Trading volume reduced to 103,000 lots, and open interest increased by 3,976 lots to 99,808 lots. Overnight, SHFE zinc recorded a bullish candlestick. The fundamental supply and demand pattern remains weak, with tight raw material supply still providing support for SHFE zinc. SHFE zinc opened low and moved higher, but it is expected to remain weak today.