Boosted by LME, SHFE zinc fluctuated at highs during the night session [SMM zinc morning comment]

SMM reported on August 13:

Overnight, LME zinc opened at $2,809.5/mt. Early in the session, LME zinc dipped to $2,809/mt, then fluctuated upward throughout the session, reaching a high of $2,854.5/mt near the close. It ultimately closed up at $2,848/mt, gaining $40/mt or 1.42%. Trading volume increased to 8,564 lots, while open interest decreased by 39 lots to 193,000 lots. Overnight, LME zinc recorded a bullish candlestick, with the 20-day moving average providing support below. The US July CPI rose mildly, further supporting expectations for a US Fed interest rate cut in September. The US dollar index weakened, and coupled with the US and China's decision to suspend the implementation of 24% tariffs for another 90 days, market sentiment was boosted, driving LME zinc higher.

Overnight, the most-traded SHFE zinc 2509 contract opened at 22,720 yuan/mt. Early in the session, SHFE zinc reached a high of 22,775 yuan/mt, then fluctuated downward, dipping to 22,630 yuan/mt. Subsequently, SHFE zinc oscillated below the daily average line, ultimately closing up at 22,685 yuan/mt, gaining 55 yuan/mt or 0.24%. Trading volume decreased to 42,749 lots, while open interest decreased by 1,609 lots to 85,879 lots. Overnight, SHFE zinc recorded a bearish candlestick, with the upper Bollinger Band forming resistance. The positive macro sentiment in the market boosted SHFE zinc to open higher with a gap. However, domestic zinc ingot inventory continued to build up, and driven by profits, smelters maintained high production enthusiasm. With strong supply and weak demand in the fundamentals, SHFE zinc lacked upward momentum in the night session.