[SMM Zinc Early Review July 20] LME zinc has delivered more than 20,000 tons of continuous warehouses, and the inventory has hit a high level in more than one year

Overnight, U.S. climate envoy Kerry held talks with Chinese officials, saying that China-U.S. climate relations still need “more work”; the IMF said that the appreciation of the dollar would hit emerging markets more than developed economies; China will announce July LPR on Thursday, and Reuters polls show that expectations for stability are unprecedentedly consistent; South Africa said that Russian President Vladimir Putin will not attend the BRICS summit in August.

Overnight, LME Zinc opened at US$2,391/ton. At the beginning of the day, LME Zinc priceextended its daily moving average downward. During European trading hours, LME Zinc price accelerated its decline and dropped to US$2,342/ton. Afterwards, short positions took profit and left the market. LME Zinc price moved up to repair, and its price center of gravity moved up to around US$2,375/ton. Positions decreased by 1,167 hands to 191,000 hands. LME Zinc price recorded four consecutive negatives overnight, and the positive column of MACD narrowed. Overnight LME inventories increased by 10,450 tons to 90,825 tons, an increase of 13%, and LME inventories continued to increase significantly. The continuous overseas delivery of more than 20,000 tons shows that overseas consumption is weak, the pattern of supply increase and demand decrease remains unchanged, and LME Zinc operates weakly.

Overnight, the 2309 contract, the main force of SHFE Zinc, opened at 20060 yuan/ton. The final closing rose to 20,070 yuan / ton, up 20 yuan / ton, a 0.1% drop, the trading volume decreased to 47,504 lots, and the open interest increased by 3901 lots to 104000 lots. Overnight, SHFE Zinc recorded a small positive line, and KDJ opened downward. SHFE Zinc continues to fluctuate within a narrow range. Downstream companies mainly buy at low prices. Imported zinc ingots continue to pour in. Traders continue to cut prices due to insufficient spot premium support. However, under policy expectations, short funds are relatively cautious, and zinc price have limited room for decline.

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