SHANGHAI, Oct. 26 (SMM) -- On Wednesday, SHFE 1301 zinc contract prices opened at RMB 14,885/mt. In the morning trading, market confidence was depressed as America's central bank did expand QE3 in interest rates decision for October, so SHFE 1301 zinc contract prices fluctuated around RMB 14,865/mt. In the midday, the Shanghai Composite Index plunged. As a result, SHFE 1301 zinc contract prices dipped to RMB 14,830/mt, but then rallied and touched RMB 14,920/mt, and finally closed at RMB 14,860/mt, up RMB 10/mt.
In domestic spot markets, discounts of #0 zinc against SHFE three-month zinc contract prices were around RMB 120/mt in the morning trading. Dragged down by the falling Shanghai Composite Index, SHFE three-month zinc contract prices dipped, but discounts did not narrow significantly, with traded prices of #0 zinc between RMB 19,710-19,740/mt. #1 zinc prices were between RMB 14,700-14,720/mt, with supply tight. Smelters began to sell goods due to cash flow problems at the end of the month, while downstream buyers remained on the sidelines. SHFE three-month zinc contract prices rose at the end of trading, but traders began to hold goods, with transactions muted.