SMM Zinc Market Morning Review (2015-5-19)

SHANGHAI, May 19 (SMM) – Escalating Greek crisis weighed down the euro whilst pushing up the US dollar index, pulling down base metals. LME zinc prices opened at USD 2,289/mt, then pointed toward USD 2,300/mt during European trading hours, and fell back to USD 2,280 mt, and closed at USD 2,283.5/mt, down USD 8/mt or 0.35%. Trading volumes decreased 3,172 to 6,951 lots, and total positions grew 3,731 to over 340,000. LME zinc inventories fell 2,550 to 435,925 mt.

SHFE 1507 zinc contract prices opened at RMB 16,835/mt Monday evening, then dropped to RMB 16,800/mt, and closed at RMB 16,795/mt, down RMB 25/mt or 0.15%. Trading volumes decreased 37,956 to 29,122 lots, and total positions fell 364 to 106,418.

Growing Greek crisis increased risk aversion, boosting gold prices. The EUR:USD slumped 1.14%. Greek bond yields plunged. NAHB housing market index in May was 54, falling short of both market expectations and April’s. San Francisco Fed announced US Q1 growth may be around 1.8％, which also lent a boost to the US dollar index.

The NBS reported home prices in China’s 70 medium and large cities rose, but prices between cities diverged. China’s A-share market closed the day down 0.58%.

Jiangsu issued RMB 52.2 billion debt today, but failed to boost market sentiment.

The US dollar index rose 0.97%；The EUR:USD decreased 1.14%. European and US stocks mostly climbed, while Asian stocks were mixed. LME base metals prices also split.

LME zinc prices are expected to move between USD 2,270-2,300/mt today. SHFE 1507 zinc contract prices will fluctuate between RMB 16,750-16,850/mt, with spot discounts of RMB 120-90/mt against SHFE 1507 zinc contract prices.