US Dollar Weakens, SHFE Zinc Center Rises [SMM Zinc Morning Comment Dec 2]

Last Friday, Zelensky: Ready to end the Russia-Ukraine conflict even if Russia does not immediately return the land it controls; Russian Deputy Foreign Minister: Russia faces the issue of resuming nuclear tests; US officials: Not considering returning nuclear weapons to Ukraine; Hamas delegation to visit Cairo to discuss Gaza ceasefire; Kazuo Ueda: Considering the timing of potential interest rate hikes; Syrian opposition forces control a military airport in Aleppo; China's manufacturing expansion in November slightly accelerated; Market interest rate pricing self-regulatory mechanism work meeting emphasized: deposit rates must not be manually subsidized in violation of regulation, loan rates must comply with risk pricing principles; PBOC net purchased government bonds worth 200 billion yuan in November; Hangzhou's first-home loan interest rate suddenly increased to 3.1%; multiple automakers' November car sales hit record highs.

Last Friday, LME zinc opened at $3,049/mt, initially fluctuating along the daily moving average, dipping to $3,040.5/mt. Subsequently, with increased long positions, LME zinc fluctuated upward, peaking at $3,112.5/mt by the end of the session, closing up at $3,108.5/mt, an increase of $61/mt or 2%. Trading volume decreased to 10,611 lots, and open interest increased by 187 lots to 249,000 lots. Last Friday, LME zinc recorded a large bullish candlestick, with LME inventory increasing by 8,225 mt to 276,850 mt, a rise of 3.06%. On the macro front, the US Fed's December interest rate cut expectations resurfaced, the US dollar weakened, and base metals broadly rose, with LME zinc rising, expected to fluctuate at high levels today.

Last Friday, the most-traded SHFE zinc 2501 contract opened at 25,385 yuan/mt, initially fluctuating widely along the daily moving average, closing up at 25,550 yuan/mt, an increase of 350 yuan/mt or 1.39%. Trading volume decreased to 177,000 lots, and open interest decreased by 977 lots to 144,000 lots. Last Friday, the most-traded SHFE zinc contract recorded a bullish candlestick. With the US Fed's interest rate cut expectations resurfacing and the US dollar weakening, while domestically, mine disturbances persisted, SHFE zinc rose, expected to fluctuate at high levels today.