[2019.7.31 Zinc Internal Morning meeting] overnight macro data warm zinc prices back up spot weakness

Zinc Morning meeting on the 31st of SMM7:

Macro: overnight US personal spending rose 0.3 per cent in June from a month earlier, expected to be 0.3 per cent, compared with a previous value of 0.4 per cent. The US PCE price index rose 1.4 per cent in June from a year earlier and is expected to rise 1.5 per cent after rising 1.5 per cent. The Commerce Department report showed that consumer spending rose at the slowest pace in four months as growth in services and other goods offset the decline in car purchases, with the core PCE index rising 0.2 per cent last month, the same increase for the third month in a row. Moderate increases in consumer spending and prices in June suggested that slowing economic growth and moderate inflation could prompt the Fed to cut interest rates on Wednesday for the first time in a decade.

Fundamentals: yesterday's spot review: zinc prices rise and transaction weakens in the three markets at the end of the month

Shanghai: zinc futures rose at the same time the monthly / next month structure turned positive, the market trading atmosphere obviously weakened, downstream turned wait-and-see again, the single trading of traders also slowed down, the market shipment intention is higher, the quotation fell slightly, the morning market is still holding a stable report on the August rise of 70 to 80 yuan / ton, but there is little feedback, the net average price as the benchmark transaction is not as good as yesterday. Entering the second trading period, some of the holders of poor transactions took the initiative to lower their quotations to about 60-70 yuan / ton, and some of them turned to shipment of 30-40 yuan / ton of rising water in September, while the consignee tended to receive the goods at a low price. However, the differences between the two sides of the transaction did not heat up the transaction, and the quotations of other downstream brands have been downgraded, and the overall transaction within the day is further weaker than that of yesterday.

Guangdong: the plate is rising and rising, refineries are actively shipping, the circulation of goods in the market is very abundant, and the quotation from the holder is relatively chaotic in the morning, with an average price of-10 yuan / ton, and a discount of 40-50 yuan / ton for contract 09. However, due to monthly difference and structural changes, some holders changed to quote a discount of 30 to 40 yuan / ton for the contract of 08 for the current month, with the continuous reverse expansion of the monthly difference. The transaction situation of the contract quotation holders of the current month has improved slightly, entering the second trading period, the market transaction is concentrated on the 09 contract discount 80-90 yuan / ton, the overall transaction atmosphere continues to be light, some traders contribute to a small number of transactions, Guangdong market transactions today are basically flat than yesterday.

Tianjin: just when the disk is going up, refineries are actively shipping, and the circulation of goods in the market is relatively abundant. In the morning, the quotation from the holder focused on the rising water of 30 yuan / ton for the 08 contract, and the price for the high price brand was 70 to 80 yuan / ton for the 08 contract. The supply of ordinary brand goods was lower than yesterday to 40 yuan / ton for the 08 contract. The market transaction improved, the trading atmosphere warmed up slightly, and the rigid demand was maintained downstream. Contributed to the main volume of transactions today. Overall, trading in Tianjin today is better than yesterday.

Zinc prices: overnight zinc received a negative line, the overall operation near the 40-day moving average, overseas markets are still in a small back structure, superimposed LME recorded a continuous decline in zinc stocks, giving some support to the fundamentals of zinc, the macro level of the Federal Reserve will soon give bulls some confidence. Overnight, Shanghai zinc received a positive line, jumped to the 40-day moving average, domestic social inventory has not increased, short confidence weakened to close positions, Japanese domestic demand to pay attention to Sino-US negotiations and the Federal Reserve interest rate cut meeting can bring positive mood.

Forecast today: expected to run in the range of 2430-2480 US dollars / ton, Shanghai Zinc main 1909 contract or operation in the vicinity of 19300-19800 yuan / ton. Material 0 # domestic increase by 50.