SHANGHAI, Jan. 9 (SMM) - LME zinc prices overnight stabilized after plunging initially. SHFE 1304 zinc contract prices opened at RMB 15,500/mt, and touched RMB 15,530/mt in the morning trading, but then reversed their increases due to falling LME zinc prices. Due to rebounding LME zinc prices and Shanghai Composite, SHFE 1304 zinc contract prices soared to RMB 15,500/mt at noon. In the afternoon, LME zinc prices slumped, and selloffs increased sharply, SHFE three-month zinc contract prices dipped to an intraday low of RMB 15,395/mt, and finally closed at RMB 15,405/mt, down RMB 135/mt. Total position increased by 666 lots to 89,816 lots.
SHFE three-month zinc contract prices inched down in the morning trading. Discounts of #0 zinc against SHFE three-month zinc contract prices were RMB 300-320/mt, with traded prices between RMB 15,150-15,180/mt. #1 zinc prices were RMB 15,130-15,140/mt. After SHFE zinc prices rebounded at noon, #0 zinc prices were around RMB 15,160/mt. A few smelters still lacked interest to move goods, while arbitrage traders released goods due to narrowing spot discounts, leading to sufficient goods supply. Although the demand to replenish stocks leading up to Chinese New Year holiday, downstream buyers were still cautious due to unacceptable prices, keeping overall transactions muted.