US Tariffs Trigger Market Sentiment Fluctuations, Zinc Prices Maintain Fluctuating Trend in Both Domestic and Overseas Markets [SMM Market Review - Weekly Price Commentary]

SMM February 7 News:

LME Zinc: At the beginning of the week, LME zinc rose as the US January Chicago PMI final reading recorded 39.5, below the market expectation of 40 but higher than the previous value of 36.9, remaining below the 50 mark, which strengthened market risk aversion sentiment. Subsequently, the US delayed raising tariffs on Melbourne and Canada, while the US January S&P Global Manufacturing PMI final reading and US January ISM Manufacturing PMI both exceeded previous and expected values. However, the US December job vacancies data released afterward fell below previous and expected values, causing LME zinc to fluctuate under the influence of policies and data. Later, US Fed officials stated that current consumer spending remains resilient, the labour market is solid, but inflation risks are rising, leading to a decline in LME zinc. Subsequently, LME zinc rebounded and surged due to the US December trade balance and US January ISM Non-Manufacturing PMI falling below expectations. As of 15:00 this Thursday, LME zinc recorded $2,832.5/mt, up $85/mt, an increase of 3.09%.

SHFE Zinc: At the beginning of the week, domestic SHFE zinc was closed for two days due to the Chinese New Year holiday. Subsequently, SHFE zinc declined continuously under the influence of market uncertainty sentiment caused by US tariff issues and the drag from the overseas market. Later, SHFE zinc rose alongside the overseas market, driven by the US December trade balance and US January ISM Non-Manufacturing PMI falling below expectations. Meanwhile, according to SMM communication, as of this Thursday (February 6), the total zinc ingot inventory across seven regions monitored by SMM was 107,000 mt, an increase of 36,600 mt compared to January 27. The domestic inventory buildup was attributed to reduced cargo pick-up during the Chinese New Year procurement period. However, the inventory buildup did not meet market expectations, further pushing SHFE zinc upward. This week, SHFE zinc exhibited a "V" shape trend. As of 15:00 this Thursday, SHFE zinc recorded 23,675 yuan/mt, up 20 yuan/mt, an increase of 0.08%.

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