LME Zinc to Remain Range-Bound (2017-2-8)

As of 22th of October, LME zinc stocks have headed down to roughly 34,700 tons, with only 24,850 tons of on-warrant inventory immediately available for pick up, this is barely sufficient to cover one day of global zinc consumption. Comparing with the level at the start of the year (230,325 tons), LME inventory saw a drawdown by around 85%. This article addresses the current situation and gives forecasts on where the squeeze may head to.

SHFE 1708 zinc opened at RMB 22,015/mt today and then fell to RMB 21,945/mt with entry of shorts.

SHFE 1708 zinc opened at RMB 21,025/mt today and then hovered around RMB 20,950/mt. In the afternoon, SHFE 1708 zinc rose to RMB 21,230/mt and then fell, and closed at RMB 21,135/mt, up RMB 245/mt or

SHFE 1706 zinc opened at RMB 22,100/mt today and then edged up to RMB 22,565/mt.

LME zinc will move between USD 2,770-2,830/mt today, and SHFE 1705 zinc should fluctuate between RMB 22,750-23,250/mt today.

US January existing home sales, eurozone annualized January CPI and IFO Business climate index in February are due for release today. Eurozone data are expected to be flat at December’s while US data

Hongkong InterBank Offered Rate (Hibor) dived 47 percentage points to 14.05% on Monday after last week’s surge. 

LME Zinc is expected to move between $2,550-2,650 per tonne next week, SMM predicts.

The LME market will be closed today, with few macroeconomic news released.

US PCE in November, Q3 GDP and durable goods orders due for release today are expected to be mixed.