The center of SHFE zinc shifted downward due to the drag of reciprocal tariff prospects [SMM Morning Comment].

Overnight, US Fed's Barkin stated that the bond market reflects increased risks of economic recession. US Treasury Secretary Besant announced that the tariffs to be announced on Wednesday will be the upper limit. The Washington Post reported that the White House plans to impose approximately 20% tariffs on at least the majority of goods imported to the US. Sources indicated that OPEC+ will adhere to its production increase plan at Thursday's meeting. Wang Yi met with Russian President Putin. A national teleconference on promoting the trade-in policy for consumer goods was held in Beijing. Bank of China adjusted the minimum purchase amount for its gold accumulation product from 700 yuan to 750 yuan.

Overnight, LME zinc opened at $2,851.5/mt. At the beginning of the session, shorts exited the market, pushing the center of LME zinc higher to touch $2,875/mt. During the European trading session, shorts increased their positions, causing LME zinc to plunge and hit a low of $2,808/mt in the night session. Subsequently, the center of LME zinc moved higher, ultimately closing down at $2,816.5/mt, a decrease of $37/mt or 1.03%. Trading volume increased to 13,028 lots, and open interest rose by 767 lots to 223,000. Overnight, LME zinc recorded a large bearish candle, with the middle Bollinger Band forming resistance above. Market concerns about the economic damage from reciprocal tariffs intensified, dragging down non-ferrous metals across the board, and the center of LME zinc moved lower.

Overnight, the most-traded SHFE zinc 2505 contract opened at 23,480 yuan/mt. At the beginning of the session, shorts increased their positions, causing SHFE zinc to plunge and hit a low of 23,230 yuan/mt. Subsequently, the center of SHFE zinc moved higher, fluctuating around 23,300 yuan/mt, ultimately closing up at 23,305 yuan/mt, a decrease of 310 yuan/mt or 1.31%. Trading volume decreased to 98,893 lots, and open interest increased by 6,535 lots to 115,000. Overnight, SHFE zinc recorded a large bearish candle, with the KDJ line opening downward. Fundamentally, zinc ingot supply remains relatively loose, while consumption growth is limited, and the market is still assessing the impact of reciprocal tariffs. SHFE zinc declined, and it is expected to remain range-bound in the short term.