SMM Zinc Market Morning Comment (Jul 11)

Overnight, LME zinc opened at $2,939/mt, falling to a low of $2,912/mt, then reaching a high of $2,974/mt, and closed at $2,956.5/mt, up $16.5/mt, or 0.56%. Trading volume increased to 7,887 lots, and open interest was reduced by 689 lots to 238,000 lots. Overnight, LME zinc recorded a bullish candlestick, with the 20-day moving average providing support below. LME zinc inventory decreased by 1,325 mt to 255,050 mt, a drop of 0.52%. Remarks by US Fed official Powell strengthened market expectations for a US interest rate cut, causing the US dollar index to fall and boosting the rebound in LME zinc.

Overnight, the most-traded SHFE 2409 zinc contract opened at 24,250 yuan/mt, dipping to 24,245 yuan/mt, then slowly climbing to a high of 24,445 yuan/mt, and closed at 24,390 yuan/mt, up 225 yuan/mt, or 0.93%. Trading volume decreased to 32,705 lots, and open interest increased by 594 lots to 74,863 lots. Overnight, the most-traded SHFE zinc contract recorded a bullish candlestick, with the 20-day moving average forming resistance above. The positive macro sentiment in overseas futures boosted the higher opening price of SHFE zinc. However, weak domestic spot consumption during the off-season dragged down the upward trend of SHFE zinc. Attention should be paid to the subsequent performance of domestic zinc ingot inventory.