SHANGHAI, Oct. 25 (SMM) -- On Wednesday, SHFE 1301 zinc contract prices opened lower at RMB 14,800/mt. In the morning trading, HSBC's October PMI for China hit a three-month high, so SHFE 1301 zinc contract prices surged to RMB 14,880/mt but then plummeted to fluctuate around RMB 14,850/mt. In the midday, the Shanghai Composite Index entered downward track as shorts entered the market. As a result, SHFE 1301 zinc contract prices plunged to RMB 14,800/mt, but then rallied and touched an intraday high of RMB 14,890/mt, and finally closed at RMB 14,880/mt, up RMB 20/mt.
In domestic spot markets, discounts of #0 zinc against SHFE three-month zinc contract prices were between RMB 100-130/mt in the morning trading. Although SHFE three-month zinc contract prices continued to fluctuate at low levels, discounts remained around RMB 120/mt, with traded prices of #0 zinc between RMB 14,720-14,760/mt, but transactions were rarely made at the high end of the price range. #1 zinc prices were between RMB 14,720-14,730/mt, with supply tight. Smelters continued to hold onto their goods, but goods supply was still ample due to arbitrage opportunities. Downstream buyers mainly remained cautious.