LME trends lifted SHFE, SHFE zinc opened higher in the night session [SMM zinc morning comment]

SMM June 18 News:

Overnight, LME zinc opened at $3,560/mt and fluctuated upward throughout the session. In early trading, LME zinc touched a low of $3,555.5/mt, then hit a high of $3,618/mt during the session, and subsequently hovered at elevated levels. It finally closed up at $3,611.5/mt, up $50/mt or 1.4%. Trading volume increased to 11,957 lots, while open interest decreased by 2,364 lots to 248,000 lots. Overnight, LME zinc formed a bullish candlestick, with support from the lower Bollinger Band. On the fundamentals side, LME zinc ingot inventory destocked slightly. Additionally, supply-side disruptions outside China persisted, prompting bears to trim positions. LME zinc rebounded from lows, with its price center moving higher.

Overnight, the most-traded SHFE zinc 2608 contract opened at 24,865 yuan/mt. During the night session, SHFE zinc opened higher with a gap and then fluctuated throughout. In early trading, SHFE zinc hit a high of 24,970 yuan/mt, and near the close it dipped to a low of 24,850 yuan/mt, finally closing up at 24,890 yuan/mt, up 150 yuan/mt or 0.61%. Trading volume decreased to 33,052 lots, while open interest increased by 1,428 lots to 88,145 lots. Overnight, SHFE zinc formed a bullish candlestick, supported by the 40-day moving average below. Boosted by the LME market performance, SHFE zinc opened higher in the night session. However, considering the persistent drag from off-season consumption on fundamentals, the near-term upside for SHFE zinc is limited, and it is expected to maintain a fluctuating trend.

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