SHANGHAI, Jan. 16 (SMM) - LME zinc prices overnight plunged. SHFE 1304 zinc contract prices opened lower at RMB 15,365/mt, and generally fluctuated around RMB 15,370/mt in the morning trading. But as LME zinc prices slumped at noon, and since short momentum strengthened, SHFE 1304 zinc contract prices slipped below the 60-day moving average, dipping to an intraday low of RMB 15,165/mt after vacillating briefly around RMB 15,240/mt. Finally, SHFE 1304 zinc contract prices closed at RMB 15,175/mt, down RMB 240/mt or 1.56%. Total position increased by 15,366 lots to 110,838 lots.
SHFE three-month zinc contract prices opened lower and then fluctuated today. Discounts of #0 zinc against SHFE three-month zinc contract prices narrowed to RMB 270-290/mt, with traded prices between RMB 15,070-15,090/mt. As SHFE zinc prices inched up at noon, #0 zinc prices rose to RMB 15,100/mt, and #1 zinc prices were RMB 15,060-15,070/mt. Smelters were unwilling to move goods due to rallying zinc prices, and arbitrage traders sold goods actively due to narrowing spot discounts, while downstream buyers took a wait-and-see attitude, with overall transactions improving.