Macro sentiment weakened, dragging SHFE zinc lower [SMM Zinc Morning Comment]

SMM November 20:

Overnight, the LME zinc contract opened at $2,989/mt. It initially fluctuated around the daily average line, then rose rapidly as bears reduced their positions, hitting a high of $3,019/mt. Subsequently, bulls cut their positions, and LME zinc fluctuated downward, touching a low of $2,975.5/mt by the end of the session. It finally closed down at $2,990/mt, down $0.5/mt or 0.02%. Trading volume fell to 9,480 lots, and open interest dropped by 2,315 lots to 218,000 lots. Overnight, LME zinc recorded a small bullish candlestick. Boosted by safe-haven sentiment and expectations that the US Fed may hold rates steady in December, the US dollar index strengthened for the fourth consecutive trading day. Additionally, as LME deliveries were made intermittently, bottom support weakened somewhat. LME zinc fluctuated, and it is expected to trade with fluctuations today.

Overnight, the most-traded SHFE zinc 2601 contract opened at 22,495 yuan/mt. It quickly rose at the beginning of the session, touching a high of 22,500 yuan/mt, then lacked upward momentum as bulls reduced their positions. SHFE zinc fluctuated downward, hitting a low of 22,385 yuan/mt by the end of the session. It finally closed down at 22,405 yuan/mt, down 30 yuan/mt or 0.13%. Trading volume fell to 21,031 lots, and open interest increased by 1,633 lots to 88,513 lots. Overnight, SHFE zinc recorded a small bearish candlestick. Expectations for a US Fed interest rate cut weakened, macro sentiment softened, and consumption remained lackluster, leading to a weaker SHFE zinc. It is expected to trade with fluctuations today.

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