SHANGHAI, Jun. 6 (SMM) -- Lacking directions from LME market, SHFE base metal prices plunged on Tuesday. But as expectations Europe will take measures to cope with the crisis grew, concerns eased, pushing down the US dollar index. In this context, SHFE 1209 zinc contract prices opened higher at RMB 14,655/mt and fluctuated between RMB 14,630-14,710/mt in the morning session. As the Shanghai Composite Index rose in the afternoon, SHFE 1209 zinc contract prices touched an intraday high at RMB 14,740/mt, but inched down as investors closed positions, with prices finally closing at RMB 14,685/mt, up RMB 100/mt. Trading volumes decreased by 86,950 lots to 101,394 lots, and total position decreased by 6,828 lots to 175,358 lots.
In domestic spot markets, discounts of #0 zinc against SHFE three-month zinc contract prices were between RMB 30-50/mt, with traded prices between RMB 14,610-14,620/mt, but transactions were limited. #1 zinc was quoted between RMB 14,570-14,590/mt. As SHFE zinc prices rose at noon, discounts of #0 zinc expanded to RMB 50-80/mt, with traded prices between RMB 14,620-14,640/mt and transactions improved. #1 zinc prices remained unchanged. Smelters were still unwilling to sell goods, with goods mainly available from traders generating cash. Downstream buyers only purchased as needed, and transactions were mainly made by traders.