LME Boosted SHFE to Rise, SHFE Zinc Center Moved Up [SMM Zinc Morning Comment]

SMM October 22 News:

  Overnight, the LME zinc contract opened at $2,991/mt. At the beginning of the session, it briefly dipped to a low of $2,982/mt, then rose with fluctuations as bears reduced their positions, touching a high of $3,031/mt during the night session, and finally closed up at $3,019.5/mt, up $26/mt, a gain of 0.87%. Trading volume increased to 12,000 lots, while open interest decreased by 2,424 lots to 222,000 lots. Overnight, LME zinc recorded a three-day winning streak, retested the 5-day and 10-day daily average moving averages, and continued its destocking trend. The LME backwardation structure reached a record high. Bears reduced positions for hedging purposes, while the US dollar performed weakly, boosting LME zinc's continued rise. LME zinc is expected to fluctuate at highs today.

  Overnight, the most-traded SHFE zinc 2512 contract opened at 22,030 yuan/mt. At the start of the session, it briefly touched a low of 22,025 yuan/mt, then fluctuated upward as bears reduced positions, reaching a high of 22,180 yuan/mt, and finally closed up at 22,140 yuan/mt, up 140 yuan/mt, a gain of 0.64%. Trading volume decreased to 74,255 lots, while open interest fell by 4,264 lots to 128,000 lots. Overnight, SHFE zinc recorded a large bullish candlestick. Stronger overseas market performance boosted the domestic market's rise. However, after the export window opened, domestic zinc ingot exports remained relatively limited. Overall consumption in October fell short of expectations, and the oversupply situation is difficult to change. SHFE zinc is expected to fluctuate today.