Futures: Overnight, LME zinc opened at $3,582.5/mt, moving sideways near the daily average line early on before edging down gradually. During the European trading session, it dipped to $3,571.5/mt, then shot up in the night session to a high of $3,625.5/mt, and edged down slightly in late trading to close up at $3,609.5/mt, up $36.5/mt, or 1.02%. Trading volume increased to 9,333 lots, and open interest decreased by 3,194 lots to 244,000 lots. Overnight, the most-traded SHFE zinc 2609 contract opened at 24,800 yuan/mt, hitting a low of 24,800 yuan/mt at the open. Bulls then added positions, pushing SHFE zinc steadily higher to a high of 24,935 yuan/mt. However, bears added positions, causing a slight pullback, though prices remained above the daily average line. A tug-of-war between longs and shorts followed, keeping SHFE zinc moving sideways. It closed up at 24,885 yuan/mt, up 185 yuan/mt, or 0.75%. Trading volume declined to 54,696 lots, and open interest increased by 3,258 lots to 108,000 lots.
Macro: Japanese media: Japan and the US jointly intervene to curb yen depreciation; Bessent: The yen seems “seriously undervalued” to me; The Fed’s favorite inflation gauge cools; The Bank of England holds interest rates steady, with three voting for a hike; South Korea’s exchange reportedly mulls a short-selling ban; Unitree Robotics sets IPO bookbuilding and subscription dates.
Spot:
Shanghai: Yesterday, Shanghai’s refined zinc procurement sentiment was 1.98, and selling sentiment was 2.55. Yesterday, SHFE zinc futures prices stayed high, and downstream enterprises maintained a wait-and-see sentiment. Inquiries and purchases showed no improvement from the previous day, and overall spot trades were sluggish. However, at month-end, traders’ willingness to sell was weak, overall market supply tightened, traders continued to hold prices firm, and some spot offers rose further.
Guangdong: Yesterday, Guangdong’s refined zinc procurement sentiment was 1.90, and selling sentiment was 2.48. During early trading, futures prices continued to rise, leading to strong wait-and-see sentiment. Although the price center later edged lower, it still consolidated at highs. Downstream enterprises, still holding some inventory, showed insufficient buying interest; purchases were mostly for drawing down existing inventory or just-in-time procurement. Spot premiums moved sideways.
Tianjin: Yesterday, Tianjin’s refined zinc procurement sentiment was 1.90, and selling sentiment was 2.43. Futures continued to consolidate at highs, and downstream buyers were cautious of high prices, mainly making just-in-time procurement. In addition, large factories began delivering under long-term contracts, leading to strong wait-and-see sentiment. Traders’ selling premiums were largely stable, and overall market transactions were moderate yesterday.
Ningbo: Yesterday morning, SHFE zinc futures prices fluctuated at highs, and with no improvement in downstream orders, spot purchases remained just-in-time. Overall transactions were sluggish, traders showed little urgency in selling, and spot premiums remained firm.
Inventory: On July 30, LME zinc inventory decreased by 1,100 mt to 100,700 mt, a decrease of 1.08%; according to SMM's communication, as of July 30, China's inventory decreased by 300 mt to 268,700 mt.
Zinc Price Outlook: Overnight, LME zinc recorded a bullish candlestick, with the 10-day and 60-day moving averages providing support. US June PCE turned negative MoM, indicating a slight easing of inflationary pressures, while the US dollar index declined yesterday, which was bullish for zinc prices. On the fundamentals side, zinc inventories outside China continued to decrease, supporting LME zinc's rise. Overnight, SHFE zinc recorded a bullish candlestick, with the 10-day and 60-day moving averages providing support for the price. As of Thursday, China's social inventory saw slight destocking but remained high, and SHFE zinc faced resistance to the upside, continuing to consolidate at highs.
Data Source Statement: All data other than publicly available information are processed by SMM based on public information, market communication, and internal SMM database models, for reference only and do not constitute any decision-making advice.
