Supply pressure persists, SHFE zinc declines slightly [SMM morning comment on zinc]

SMM News on July 2:

Overnight, LME zinc opened at $2,742.5/mt. Early in the session, LME zinc reached a high of $2,749/mt, then quickly declined and fluctuated below the daily average line. After another failed attempt to rally, it pulled back near the daily average line. Towards the end of the session, LME zinc slipped again, reaching a low of $2,708/mt. It eventually closed down at $2,713.5/mt, a drop of $27.5/mt or 1%. Trading volume increased to 12,773 lots, while open interest rose by 842 lots to 208,000 lots. Overnight, LME zinc recorded a bearish candlestick, with the 10-day moving average providing support below. As the tariff suspension deadline approaches, the market continues to focus on macroeconomic disruptions. The US dollar index first fell and then rose, with LME zinc maintaining a low-level fluctuation.

Overnight, the most-traded SHFE zinc 2508 contract opened at 22,250 yuan/mt. Early in the session, SHFE zinc reached a high of 22,305 yuan/mt, then fluctuated downward throughout. Towards the end of the session, it reached a low of 22,150 yuan/mt. It eventually closed down at 22,175 yuan/mt, a drop of 80 yuan/mt or 0.36%. Trading volume decreased to 55,730 lots, while open interest rose by 165 lots to 135,000 lots. Overnight, SHFE zinc recorded a bearish candlestick, with the 10-day moving average forming resistance above. LME zinc prices fell slightly, while the domestic supply of zinc ingots gradually increased. The fundamental supply-demand imbalance continued to suppress zinc price trends, with the center of SHFE zinc prices slightly declining.