[notes of SMM Zinc Internal Morning meeting]

On the 12th of SMM7,

On the 12th of SMM7,

Zinc Morning meeting: macro: Fed Chairman Powell said there was room to cut interest rates and monetary policy could be too tight; however, the latest release of the US CPI was stronger than forecast, leading to a drop in expectations of a rate cut in July. Trump complained that China had not fulfilled its promise to buy US agricultural products made at the G-20 summit. The minutes of the ECB meeting show that policymakers generally agree on the need to prepare for policy easing. China will release trade data for June today, with dollar-denominated imports and exports expected to fall year-on-year.

Fundamentals: yesterday's zinc spot review:

Shanghai: macro positive to the zinc price boost is limited, zinc low operation, market circulation tends to be relaxed, but the next month discount market quotation is cautious, the morning market is still the month reported rising water 60-70 yuan / ton, and did not change the month, but the transaction to the average price fluctuated, the rising discount transaction is a little light, in the later period, the activity of the month is low and the monthly difference is stabilized, some traders report the rising water 50 / 60 or so in August to promote part of the transaction. However, the overall market trading atmosphere is weak, the transaction is relatively flat.

Guangdong: normal shipment of refineries, abundant circulation of goods in the market. In the morning, the holder actively shipped the goods, and the quotations concentrated around the average price of-20 yuan / ton. Some of the contract holders reported that the discount for the 08 contract was 20-10 yuan / ton, and entered the second trading period. The holder actively flashed the goods for shipment, and reported that the discount for the 08 contract was about 40 yuan / ton. Subsequently, the market transaction was slightly improved. Mainly by traders to contribute to the main instructor, downstream more to wait and see, superimposed order transfer is poor. The willingness to receive the goods is not good. The trading situation in Guangdong today was basically stable compared with that of yesterday.

Tianjin: the arrival of goods in Tianjin warehouse is less, and the circulation of goods in the market continues to be tight. Some of the cargoes have a smaller volume and a stronger willingness to bid. In the morning, the quotations focused on raising the water of the 07 contract by 100 to 200 yuan / ton, and the market trading atmosphere was more enthusiastic. Some of the subsequent holders raised the supply of Zijin brand to around 220 yuan / ton of the 07 contract, and the shipping situation was still unaffected. Today, due to the tight circulation of goods in Tianjin market, the transaction atmosphere is more warm, but the delivery volume has dropped compared with yesterday.

Zinc price: Len Zinc lost US $2400 / ton gate support, below the 5-day EMA to give some support to Len Zinc, however, under the contango structure, Len Zinc stocks recorded a decline, overseas markets still have certain expectations for the subsequent inventory increase, Geneva Zinc is expected to run around US $2360 to US $2410 / ton. Shanghai zinc closed negative, attached to the shadow of the 5-day EMA suppression, supply-side recovery of the market for inventory accumulation expectations enhanced, but the spot rise discount continues to decline reflects the actual consumption is relatively weak, the basic support is weak, the day Shanghai zinc or maintain interval concussion.

Forecast today: expected to run in the range of 2360-2410 US dollars / ton, Shanghai Zinc main 1909 contract or run in 18750-19250 yuan / ton. Material 0 # domestic fall 10