Uncertainty in international trade persists, with zinc prices maintaining a fluctuating trend this week [[SMM Market Review - Weekly Price Commentary]]

LME Zinc: At the beginning of the week, LME zinc extended its downward trend from the previous week, influenced by the higher-than-expected final reading of the University of Michigan Consumer Sentiment Index for April in the US on Friday. Subsequently, positive macroeconomic developments in China drove LME zinc slightly higher. Then, Trump stated to the media that he believed no red lines would change the tariff policy, intensifying market concerns over trade. Meanwhile, the Dallas Fed Business Activity Index for April in the US fell below the previous reading and expectations, with the overall business activity index plummeting to -35.8, marking the third consecutive month of decline. Market risk aversion emerged, and LME zinc maintained a fluctuating trend amid multiple factors. Later, as the market continued to digest positive macroeconomic sentiment, LME zinc continued to rise. Then, supported by hopes for a US trade agreement, the US dollar index climbed higher, leading to a decline in LME zinc. Subsequently, the US JOLTs Job Openings data for March was released, showing a final reading of 7.192 million, below the previous reading and expectations, indicating weak data performance. Similarly, the Conference Board Consumer Confidence Index for April in the US also showed sluggish performance, reigniting market risk aversion and driving LME zinc slightly higher. However, constrained by market concerns over the trade situation, LME zinc declined again. As of 15:00 on Wednesday this week, LME zinc closed at $2,641/mt, down $4.5/mt or 0.17%.

SHFE Zinc: At the beginning of the week, SHFE zinc declined to its weekly low, driven by the LME market. Subsequently, influenced by renewed positive macroeconomic developments in China, with the central bank indicating it would implement RRR cuts and interest rate cuts at appropriate times and create new structural monetary policy tools, and China planning to introduce measures to stabilize employment and the economy, positive news drove SHFE zinc slightly higher. Then, on the fundamentals side, China's social inventory increased slightly compared to Thursday of the previous week, while uncertainties persisted in the global trade market internationally, causing SHFE zinc to maintain a fluctuating trend. Later, as the domestic market continued to digest positive macroeconomic sentiment, SHFE zinc continued to rise. Then, in terms of data, the US labor force data for March showed weak performance, and the US Consumer Confidence Index for April also remained sluggish, leading to a lack of confidence in subsequent developments and escalating risk aversion in the market. Under macroeconomic influences, SHFE zinc in China also rose. Subsequently, Trump relaxed the automobile tariff policy and considered using AI chips as a new bargaining chip in negotiations. However, influenced by his erratic trade policies, macroeconomic uncertainties persisted, and SHFE zinc continued to decline. As of 15:00 on Wednesday this week, SHFE zinc closed at 22,440 yuan/mt, down 310 yuan/mt or 1.36%.

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