[SMM Analysis] overseas Market supply and demand double weak domestic galvanized orders improving Alloy Market weak

SMM4, 17 March:

The unemployment situation in the United States was more serious this week, with the number of new jobless claims hitting a new high that week, totaling more than 22 million for four consecutive weeks. At the same time, the spread of the epidemic abroad has yet to see a clear inflection point, but the growth rate of new confirmed cases has slowed slightly, and Trump is eager to restart the US economy, announcing guidance on gradually lifting restrictions on economic activity, giving a slight boost to macro sentiment.

As far as Lun Zinc is concerned, the inventory of Lun Zinc has increased again this week, reflecting the weak demand in overseas markets under the influence of the epidemic, and the contango structure has narrowed slightly. On the whole, the pattern of weak supply and demand has not changed. With overseas outbreaks having a significant impact on consumers, the announcement next week that PMI in manufacturing and services in Europe and other countries is expected to further depress prices. From a technical point of view, this week's zinc station on the 40-day moving average, the lower side of the moving average support is strong, but the KDJ index is parallel, indicating that the action on zinc is more limited. Overall, it is expected that next week zinc or partial shock operation, the market still needs to pay attention to the situation of overseas epidemic fermentation.

On the Shanghai zinc point of view, this week, with the gradual recovery of infrastructure and real estate terminals, zinc downstream consumer enterprises part of the plate orders gradually improved, but also some plates are seriously dragged down by the dismal external demand, the prosperity has been declining one after another. As far as fundamentals are concerned, the supply side next week is slightly tighter than this week, Mengzi smelter began maintenance, superimposed Chifeng medium color and Xing'an copper and zinc are expected to be overhauled at the end of the month or the second half of the month, and the circulation of goods in the market is expected to decline slightly from next week. On the consumer side, at present, the orders of galvanized structural parts enterprises driven by infrastructure and real estate are better, while the consumption of die-casting zinc alloy enterprises and zinc oxide enterprises, which are dragged down by the sharp decline in foreign trade orders, is not expected to improve next week. Overall, the supply side contribution reduction, superimposed downstream enterprises galvanized driven zinc consumption is relatively large, so it is expected to go to the warehouse next week or continue. From a technical point of view, this week Shanghai zinc main contract station on the Wanliu pass, but the upper moving average pressure is strong, is expected to maintain 40 days near the concussion operation.

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