SMM Zinc Market Morning Review (2015-3-12)

SHANGHAI, Mar. 12 (SMM) – LME zinc prices dipped to an 11-month low yesterday due to negative macroeconomic news. Sluggish economic indicators from China caused market concerns to grow. Increasing tensions between Greece and Germany allowed the US dollar index to climb whilst pushing down the euro to a 12-year low. This weighed down US stocks, COMEX crude oil prices and gold prices. LME zinc prices opened at USD 2,021/mt, and tumbled to an 11-month low of USD 1,993/mt, and closed at USD 2,001/mt, down USD 16.5/mt, or 0.82%. Trading volumes were up 3,721 to 10,230 lots, and total positions increased 872 to 288,910. LME zinc inventories grew 2,050 to 542,850 mt.

SHFE 1505 zinc contract prices opened at RMB 15,725/mt Wednesday evening, then dropped to RMB 15,600-15,650/mt, and closed the day at RMB 15,600/mt, down RMB 115/mt or 0.73%. Trading volumes increased 11,872 to 51,916 lots, and total positions increased 3,484 to 177,916.

Germany’s February CPI, Eurozone January industrial output and US February retail sales slated for release today are expected to improve. With pressure and the strong US dollar index, LME zinc prices are expected to move between USD 1,995-2,020/mt. SHFE 1505 zinc contract prices will fluctuate between RMB 15,580-15,680/mt, with spot premiums of RMB 20-50/mt.