SMM Morning Review - 2011/8/22 Zinc Market

SHANGHAI, Aug. 22 (SMM)--Investors' concerns over global economic recovery gained ground last week due to poor economic data, and they switched to risk adverse assets instead such as the gold due to tightening credit loans in the Europe. In this scenario, gold prices hit another record last Friday, up USD 30.2/oz, to close at USD 1,852.2/oz. Standard & Poor's downgraded the outlook of US economic growth for next three years to 1.7%, pushing down the US dollar index to 73.6, down from 74. As a result, LME zinc prices surged to USD 2,200/mt at the end of trading, but failed to break through that level, with prices finally closing at USD 2,196/mt, up USD 33/mt. SHFE three-month zinc contract prices should fluctuate between RMB 16,650-16,950/mt today, with discounts remaining at negative RMB 100-200/mt.