SMM Zinc Ingot Inventory Continues to Decline, Providing Some Support for Zinc Prices [SMM Zinc Morning Comment]

SMM November 25:

Overnight, the LME zinc contract opened at $2,987.5/mt. After opening, LME zinc fluctuated upward, touching a high of $3,015/mt, then fluctuated and pulled back all the way, approaching a low of $2,987.5/mt near the session's end. Subsequently, LME zinc rose slightly and traded near the daily average line, finally closing up at $3,003/mt, up $11/mt, a gain of 0.37%. Trading volume decreased to 6,251 lots, and open interest decreased by 1,637 lots to 217,000 lots. Overnight, LME zinc formed a bullish candlestick, with the 10-day moving average providing resistance above. Although LME zinc ingot inventory continued to grow recently, strengthened expectations for a US Fed interest rate cut next month provided ongoing macro support for zinc prices. During the night session, LME zinc maintained a fluctuating trend.

Overnight, the most-traded SHFE zinc 2601 contract opened at 22,335 yuan/mt. Early in the session, SHFE zinc touched a low of 22,275 yuan/mt, then fluctuated rangebound around the daily average line. During the session, SHFE zinc rose slightly above the daily average line, touching a high of 22,365 yuan/mt near the session's end, finally closing down at 22,320 yuan/mt, down 70 yuan/mt, a loss of 0.31%. Trading volume decreased to 36,148 lots, and open interest increased by 3,740 lots to 100,000 lots. Overnight, SHFE zinc formed a bearish candlestick, with the 5-day moving average providing resistance above. Zinc ingot consumption performed weakly during the year-end off-season, but domestic TCs continued to decline. SMM's social zinc ingot inventory dropped again on Monday, providing some support for SHFE zinc. Zinc prices are expected to maintain a fluctuating trend in the short term.

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