Macro Sentiment Remains Strong, LME Zinc Records Four Day Winning Streak [SMM Zinc Morning Comment]

SMM, Aug 28: Overnight, the Chicago and New York Federal Reserve Boards approved a discount rate cut at their July meetings; Libya's El-Feel oil field is reportedly shutting down; Iran's Deputy Defense Minister stated that Iran's response will be unpredictable; the US National Security Council said that if Iran launches an attack, the US will defend Israel; Wang Yi met with US National Security Advisor Sullivan; the 11th session of the Standing Committee of the National People's Congress will be held in Beijing from September 10 to 13; the People's Bank of China and seven other departments jointly issued guidelines; the Ministry of Finance and four other departments jointly issued a notice to improve the policy of duty-free shops within cities.
Overnight, LME zinc opened at $2,920/mt. In the initial trading, bears had the upper hand, and LME zinc operated weakly below the daily moving average. During European trading hours, it attempted to break upwards but failed, hitting a low of $2,888.5/mt. Subsequently, bulls entered at the low, and LME zinc fluctuated upwards, accelerating its rise during the night session. The focus shifted to around $2,940/mt, with a high of $2,945/mt, and finally closed up at $2,936.5/mt, an increase of $18.5/mt or 0.63%. Trading volume decreased to 11,493 lots, and open interest increased by 3,051 lots to 218,000 lots. Overnight, LME zinc recorded four consecutive gains, with the daily K-line focus moving upwards. LME inventory decreased by 250 mt to 255,800 mt, a drop of 0.1%. The expectation of a rate cut pushed the US dollar index lower, leading to a broad rise in non-ferrous metals, with LME zinc's focus moving upwards. Attention should be paid to geopolitical risks in the future.
Overnight, the most-traded SHFE zinc 2410 contract opened at 24,055 yuan/mt. In the initial trading, bulls increased their positions, pushing SHFE zinc to fluctuate upwards along the daily moving average. The focus shifted to around 24,200 yuan/mt, with a high of 24,280 yuan/mt, and finally closed up at 24,225 yuan/mt, an increase of 205 yuan/mt or 0.85%. Trading volume decreased to 83,446 lots, and open interest increased by 5,957 lots to 125,000 lots. The upper Bollinger Bands forming resistance. Under the expectation of reduced production by smelters, bullish sentiment has not yet subsided, and increased positions by funds pushed SHFE zinc to move at a high level.