Zinc prices record a four-day winning streak, with the daily candlestick center edging up [SMM Morning Meeting Summary]

Zinc Morning Meeting Summary for October 22

Futures: Overnight, LME zinc opened at $3,738.0/mt. In early trading, LME zinc drifted lower, dipping to $3,711.0/mt before the European session. Entering the night session, bears took profits and exited, and LME zinc drifted higher to touch $3,765.0/mt, ultimately closing up at $3,757.0/mt, an increase of $16.0/mt, or 0.43%. Trading volume increased by 1,067 lots to 11,430 lots, while open interest decreased by 4,849 lots to 254,000 lots. Overnight, the SHFE zinc 2612 contract opened at 25,630 yuan/mt. In early trading, SHFE zinc quickly dipped to an intraday low of 25,615 yuan/mt. Subsequently, bulls added positions, driving prices sharply higher to touch 25,790 yuan/mt. In the latter part, bullish momentum weakened, and SHFE zinc pulled back under pressure, consolidating before ultimately closing up at 25,700 yuan/mt, an increase of 150 yuan/mt, or 0.59%. Trading volume decreased by 60,775 lots to 57,023 lots, while open interest increased by 2,426 lots to 118,000 lots.

Macro: Kremlin: In principle, ready to resume trilateral peace talks in mid-November; Zelensky: Willing to reach a peace agreement on the basis of retaining at least 75% of territorial control; Iranian Foreign Minister: Currently sees no reason for progress in negotiations. The US State Department clarified that the "planned order to evacuate some embassy personnel in the Gulf region" applies only to Saudi Arabia.

Spot Market:

Shanghai: Refined zinc purchasing sentiment in Shanghai was 2.04, and selling sentiment was 2.58. In the morning session, zinc futures edged up, and downstream wait-and-see sentiment was strong. Yesterday's spot transactions remained need-based, overall spot trades were sluggish, and market quotes showed some divergence, with some suppliers lowering spot offers.

Guangdong: Refined zinc purchasing sentiment in Guangdong was 1.96, and selling sentiment was 2.50. Yesterday, futures rose, while some downstream buyers had already made purchases this week, leading to low inquiry and purchasing enthusiasm. The spot market was relatively sluggish yesterday, and spot premiums declined.

Tianjin: Refined zinc purchasing sentiment in Tianjin was 1.92, and selling sentiment was 2.45. Futures rebounded, but downstream buyers still held bearish expectations, making only small restocking purchases for immediate needs. Trader selling premiums remained relatively firm, and overall market transactions were moderate.

Ningbo: Trader quotes in the Ningbo market were basically flat compared with the previous day, but zinc futures edged up. Downstream alloy plants showed limited purchasing enthusiasm, and transactions remained mostly need-based, with overall market trades sluggish.

Social Inventory: On October 20, LME zinc inventory increased by 1,500 mt to 166,825 mt, up 0.9%. According to SMM communication, as of October 19, China's inventory decreased by 1,900 mt to 200,200 mt.

Zinc price forecast: Overnight LME zinc recorded a four-day winning streak, with the daily candlestick center continuing to move higher and the MACD bearish candlestick narrowing. On the macro front, geopolitical conflicts remained volatile, but oil prices were stable, macro sentiment recovered, and there were clear signs of bears reducing positions and leaving the market. LME inventory continued to increase, and the previous main pricing logic for zinc prices has loosened somewhat, with zinc prices undergoing a weak recovery. Overnight SHFE zinc recorded a bullish candlestick with upper and lower shadows, with the daily candlestick center continuing to move higher and the 5-day moving average providing support below. China's zinc ingot exports in September reached 70,400 mt, slightly exceeding expectations, and a certain export volume is still expected in October. Coupled with a slight improvement in downstream consumption, the zinc price center edged up.

Data source statement: Except for publicly available information, all other data are processed by SMM based on public information, market communication, and SMM's internal database models, and are for reference only and do not constitute decision-making advice.