US ADP Employment Growth Slows, LME Zinc Fluctuates Downward [SMM Zinc Morning Comment]

SMM, Sep 6: Overnight, the US ADP employment growth hit a three-year low; OPEC+ postponed the start of capacity restoration for eight member countries by two months; Putin stated readiness for negotiations with Ukraine; the US Fed sought public comments on reforming discount window operations; Xi Jinping announced that China has elevated bilateral relations with all African countries to a strategic level; the PBOC indicated room for RRR cuts, though further reductions in deposit and loan interest rates face certain constraints; five departments, including the Ministry of Finance, announced zero tariffs on pharmaceuticals and medical devices in Hainan Free Trade Port; and Guotai Junan initiated a merger with Haitong Securities.
Overnight, LME zinc opened at $2,808/mt, initially fluctuating near the daily moving average, peaking at $2,811/mt. Subsequently, longs reduced positions, causing LME zinc to fluctuate downward, hitting a low of $2,721/mt during European trading hours. Later, LME zinc's focus shifted upward, fluctuating around $2,750/mt during the night session, ultimately closing down at $2,730.5/mt, a decrease of $72.5/mt or 2.59%. Trading volume increased to 13,296 lots, and open interest decreased by 852 lots to 222,000 lots. Overnight, LME zinc recorded a bearish candlestick, with LME inventory decreasing by 475 mt to 239,275 mt, a drop of 0.2%. The US ADP employment growth hit a three-year low, raising concerns about weak US economic growth. The market awaits Friday's non-farm payroll report, with expectations of a downward trend today.
Overnight, the most-traded SHFE zinc 2410 contract opened at 22,810 yuan/mt. Initially, longs reduced positions, causing SHFE zinc to plunge to a low of 22,590 yuan/mt. Subsequently, SHFE zinc's focus shifted upward, fluctuating around the daily moving average, ultimately closing up at 22,745 yuan/mt, an increase of 50 yuan/mt or 0.22%. Trading volume decreased to 138,000 lots, and open interest decreased by 1,678 lots to 101,000 lots. Overnight, SHFE zinc recorded a bearish candlestick. On the fundamentals side, the long-term ore supply tightness has eased, weakening the support for zinc prices from the supply side. The market awaits more macroeconomic guidance, with expectations of a downward fluctuation today.