SMM Zinc Market Daily Review (2012/10/10)

SHANGHAI, Oct. 11 (SMM) -- On Wednesday, SHFE 1301 zinc contract prices opened at RMB 15,460/mt as LME zinc prices overnight closed down, and once dipped below the 30-day moving average to RMB 15,200/mt, and then fluctuated around the moving averages. Although longs entered the market, SHFE 1301 zinc contract prices failed to rally to RMB 15,500/mt since LME zinc prices continued to fall. As the Shanghai Composite Index rose in the afternoon, SHFE 1301 zinc contract prices edged up and finally closed at RMB 15,410/mt, down RMB 170/mt or 1.09%.

In domestic spot markets, discounts of #0 zinc against SHFE three-month zinc contract prices narrowed to RMB 230-250/mt, with traded prices between RMB 15,130-15,170/mt. #1 zinc prices were between RMB 15,100-15,120/mt. Downstream buyers increased purchases as zinc prices plunged, and traders released goods due to narrowing spot discounts, keeping goods supply ample, and with transactions improving.