Macro Sentiment Improved, LME Zinc Center Rose [SMM Morning Meeting Minutes]

Futures: During the overnight session, LME zinc opened at $3,400/mt. At the beginning of the session, LME zinc briefly dipped to a low of $3,398/mt. Subsequently, bulls increased positions, and LME zinc fluctuated upward throughout the session, reaching a high of $3,439/mt during the night session, ultimately closing up at $3,420.5/mt, up $20.5/mt or 0.6%. Trading volume fell to 9,595 lots, and open interest increased by 1,972 lots to 219,000 lots. During the overnight session, the most-traded SHFE zinc 2605 contract opened at 23,960 yuan/mt. At the beginning of the session, bears reduced positions, and SHFE zinc briefly rose to a high of 24,070 yuan/mt. Subsequently, upward momentum was insufficient, and SHFE zinc fluctuated downward throughout the session, touching a low of 23,915 yuan/mt, ultimately closing up at 23,935 yuan/mt, up 30 yuan/mt or 0.13%. Trading volume fell to 33,598 lots, and open interest decreased by 3,378 lots to 63,962 lots.
Macro:
Trump said the US and Iran may resume talks over the weekend; Trump said Iran agreed not to possess nuclear weapons, while Iran has not yet responded; Israel's PM agreed to a ceasefire and would maintain troops in southern Lebanon; Russian forces launched large-scale airstrikes on multiple Ukrainian cities, with Kyiv, Odesa and others severely hit; China's GDP grew 5.0% YoY in Q1; the State-owned Assets Supervision and Administration Commission of the State Council held a special promotion meeting on the low-altitude economy industry development of central state-owned enterprises.
Spot market:
Shanghai: The purchasing sentiment for refined zinc in the Shanghai region was 1.9, and the shipments sentiment was 2.7. Zinc ingot inventory in Shanghai continued to accumulate. Zinc prices on futures rose during the morning session, but downstream enterprises remained on the sidelines yesterday due to fear of high prices, with limited inquiry-based purchasing. Spot trades were sluggish, and traders slightly lowered spot premiums to facilitate shipments.
Guangdong: The purchasing sentiment for refined zinc in the Guangdong region was 1.71, and the sales sentiment was 2.54. Yesterday, the zinc price center rose notably MoM, but the number of traders making shipments in the market decreased. Trading among traders improved slightly compared to the previous day, but downstream fear of high prices was prominent. Spot transactions were poor, and premiums continued to decline yesterday.
Tianjin: The purchasing sentiment for refined zinc in the Tianjin region was 1.81, and the shipments sentiment was 2.51. Yesterday, zinc prices continued to surge significantly. Downstream buyers were cautious about purchasing due to fear of high prices, with few inquiries. Trading was mainly among traders, and traders' shipments remained at significant discounts. The overall market was sluggish.
Ningbo: Yesterday, traders in the market offered prices passively for shipments. Spot premiums edged lower, but downstream enterprises mostly held certain raw material inventories. Inquiry enthusiasm was low yesterday, and spot transactions in the market performed poorly.
Social inventory: On April 16, LME zinc inventory decreased by 1,725 mt to 114,750 mt, down 1.48%. According to SMM's market communication, as of April 16, China's inventory increased.
Zinc price outlook: LME zinc posted a small bullish candlestick during the overnight session. The prospects for new peace talks among the US, Israel, and Iran were positive, market concerns eased, the US dollar weakened, and non-ferrous metals rose broadly. The LME zinc price center continued to shift upward, and it is expected to mainly fluctuate at highs today. SHFE zinc posted a small bearish candlestick with a long upper shadow during the overnight session. Macro sentiment continued to improve, while domestic ore supply remained relatively tight. The SHFE zinc price center shifted upward, and it is expected to mainly fluctuate at highs today.

Data source disclaimer: Data other than publicly available information is derived from public information, market communication, and SMM's internal database models, processed by SMM for reference only and does not constitute decision-making advice.