Easing tensions in the Middle East ease market risk-averse sentiment, LME zinc rises [SMM Morning Meeting Summary]

Futures Market: Overnight, LME zinc opened at $2,687.5/mt. Early in the session, LME zinc briefly dipped to a low of $2,685.5/mt before bears reduced their positions, allowing LME zinc to fluctuate upward throughout the night session, reaching a high of $2,722/mt. However, the upward momentum waned, causing the center of LME zinc prices to shift downward. It eventually closed up at $2,710/mt, gaining $29.5/mt or 1.10%. Trading volume decreased to 11,290 lots, while open interest fell by 623 lots to 212,000 lots. Overnight, the most-traded SHFE zinc 2508 contract opened at 22,090 yuan/mt. Early in the session, SHFE zinc slightly dipped to a low of 22,030 yuan/mt before bulls increased their positions, causing SHFE zinc to fluctuate along the daily average line, reaching a high of 22,100 yuan/mt. SHFE zinc mainly fluctuated considerably, with fluctuations of less than 100 yuan. It eventually closed up at 22,095 yuan/mt, gaining 50 yuan/mt or 0.23%. Trading volume decreased to 47,542 lots, while open interest increased by 98 lots to 130,000 lots.
Macro: Trump: The US will hold talks with Iran next week, and I don't think a nuclear deal is necessary. Trump: The next Fed Chairman will be selected from among three or four candidates. Powell: The one-time impact of tariffs may become the baseline expectation. The US Fed proposes to ease enhanced supplementary leverage ratio requirements for large banks. US housing regulator: Plans to consider cryptocurrency as mortgage collateral. Sources: Russia is willing to increase oil production again if OPEC deems it necessary. Nvidia's market capitalization hits a record high of $3.75 trillion. The Hong Kong Monetary Authority buys HKD9.42 billion in the market as the Hong Kong dollar exchange rate touches the weak-side Convertibility Undertaking.
Spot Market:
Shanghai: Yesterday, the supply in the Shanghai market remained limited, and domestic traders continued to refuse to budge on prices. Spot premiums held steady yesterday, but with futures maintaining a relatively high fluctuating trend, downstream buyers showed little interest in purchasing, resulting in poor spot purchase performance. Yesterday's transactions were mainly among traders.
Guangdong: Overall, futures fluctuated higher yesterday, with downstream procurement enthusiasm remaining low. Meanwhile, current downstream consumption has weakened, leading traders to slightly lower premiums under these circumstances. However, there were few traders offering discounts in the market. Additionally, with the price spread between futures contracts widening yesterday, spot premiums remained unchanged from the previous day.
Tianjin: Zinc prices continued to fluctuate at highs, with downstream procurement enthusiasm remaining low. There were few price inquiries and fixed-price transactions, and with new long-term contracts about to be executed, traders continued to lower premiums to facilitate sales, causing premiums to continue to decline. Overall market transactions were weak.
Ningbo: Futures maintained a fluctuating trend, and spot premium quotes from Ningbo traders held steady. Some downstream orders were weak, and procurement sentiment was low. Overall spot transactions did not show improvement yesterday.
Social Inventory: On June 25, LME zinc inventory decreased by 575 mt to 122,875 mt, a decline of 0.47%. According to SMM communications, as of Monday (June 23), the total zinc ingot inventory across seven locations tracked by SMM was 77,800 mt, a decrease of 1,000 mt from June 16 and a decrease of 1,800 mt from June 19. Domestic inventory recorded a decrease.
Zinc Price Forecast: Overnight, LME zinc recorded a large bullish candlestick, with the KDJ line opening upwards. Trump announced that the US would hold talks with Iran next week, easing risk-averse sentiment. Additionally, market expectations for an interest rate cut have resurfaced, causing the US dollar to weaken and LME zinc to rise. It is expected that LME zinc will continue to fluctuate at highs today. Overnight, SHFE zinc recorded a small bullish candlestick. Boosted by overseas market sentiment, SHFE zinc followed the LME's upward trend. However, domestic consumption is gradually weakening, and there are still expectations of a supply surplus for zinc. It is expected that SHFE zinc will continue to operate with highs fluctuations today.