SHANGHAI, Feb. 3 (SMM) -- Boosted by strong LME zinc prices, SHFE three-month zinc contract prices briefly climbed to a high of RMB 15,970/mt after opening, but later prices gradually lost the 5-day moving average following declines in LME zinc prices, with prices even dipping to an intraday low of RMB 15,775/mt in the midday. In the afternoon session, bullish performance of domestic stocks helped drive up SHFE three-month zinc contract prices, with prices even returning to above the 5-day moving average and finally closing at RMB 15,945/mt, up RMB 50/mt. Trading volumes increased by nearly 50,000 lots to 271,734 lots, while positions increased by 7,690 lots to 167,558 lots.

In the spot market, spot discounts narrowed gradually from RMB 350/mt, to RMB 260-280/mt as SHFE three-month zinc contract prices fell continuously. #0 zinc was traded around RMB 15,550/mt, while imported zinc was quoted at discounts of RMB 400-420/mt. #1 zinc was traded between RMB 15,500-15,550/mt, with most deals made at the low-end. Zinc prices had fallen for two consecutive days, spurring market cautiousness and in turning resulting in light trading.