SHANGHAI, Jun. 27 (SMM) - SHFE 1310 zinc contract prices opened RMB 100/mt higher at RMB 14,435/mt, as LME zinc prices overnight closed the day with gains. The Shanghai Composite Index stopped rebounding and closed with declines of 0.41%, and LME zinc prices also inched down, with a large number of longs leaving the market. SHFE zinc prices touched USD 14,500/mt before falling, dipping to RMB 14,305/mt and finally closing at RMB 14,315/mt, down RMB 20/mt or 0.14%. Trading volumes decreased by 2,914 lots, to 77,182 lots, and total positions increased by 10,506 lots to 158,128 lots.
SHFE zinc prices found strong support at RMB 14,300/mt, but will continue to fall as copper prices remain sluggish and since domestic cash flows did not improve.
#0 zinc prices were between RMB 14,460-14,480/mt, with spot premiums between RMB 80-110/mt against SHFE 1310 zinc contract prices. #1 zinc prices were between RMB 14,410-14,430/mt. SHFE zinc prices opened high but moved lower, and domestic stocks markets were also sluggish, triggering market apprehension. Smelters were actively moving goods due to cash flow problem, but began to hold back goods as zinc prices fell, while downstream buyers are optimistic towards price trends and are faced with cash flow tightness, so they stood on the sidelines, keeping transactions muted. SHFE zinc prices continued to fall in the afternoon, while cargo holders held #0 zinc prices firm between RMB 14,450-14,460/mt, with spot premiums expanding to RMB 120-130/mt.