Zinc Prices Drop Across Markets Amid Bearish Trends
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LME zinc fell by 2.47% to $2,867/ton, SHFE zinc dropped 1.29% to 23,700 yuan/ton, and MCX zinc decreased 1.50% to ₹265.50/kg. Weak demand, Fed rate cuts, and potential US port strikes could further pressure zinc prices downward.
Price
- LME: As of last Friday, LME zinc opened at $2,933.5/ton, hit a high of $2,955/ton, a low of $2,866.5/ton, and closed at $2,867/ton, down by $72.5/ton or 2.47%. Today, LME Zinc trading commenced at $2,869/ton.
- SHFE: As of last Friday, the most-traded SHFE zinc 2411 contract opened at 23,905 yuan/ton, hit a high of 23,920 yuan/ton, a low of 23,620 yuan/ton, and closed at 23,700 yuan/ton, down by 310 yuan/ton or 1.29%. Today, SHFE Zinc trading commenced at 23,510 yuan/ton.
- MCX: As of last Friday, zinc prices opened at ₹270.45/kg, reached a high of ₹271.05/kg, a low of ₹265.20/kg, and closed at ₹265.50/kg, down by ₹4.05 or 1.50%. Today, MCX Zinc trading commenced at ₹265.50/kg.
Supply & Demand
- LME Stock: Opening Stock - 256,150 tons | Live Warrants - 229,425 tons | Cancelled Warrants - 26,725 tons.
- LME: Trading volume rose to 116,000 lots, while open interest decreased by 3,211 lots to 240,000 lots. Last Friday, LME zinc recorded a bearish candlestick with no lower shadow, as the upper Bollinger Bands formed resistance and the 10/60-day moving averages provided support. LME social inventory decreased by 650 tons to 256,150 tons, down by 0.25%. With the US Fed Governor hinting at more 50 basis points rate cuts, LME zinc is expected to fluctuate downward.
- SHFE: Trading volume fell to 69,340 lots, while open interest increased by 898 lots to 101,000 lots. Last Friday, SHFE zinc also recorded a bearish candlestick, with the daily K-line center of gravity moving downward. The upper Bollinger Bands formed resistance, and the 10/60-day moving averages provided support. Both supply and demand remain weak, and SHFE zinc is expected to fluctuate downward.
News
- Rate Cuts Expected: Last Friday, US Fed Governor Waller hinted at additional 50 basis points rate cuts. Industrial metals like copper and zinc could remain under pressure.
- Port Strike: Around 45,000 workers at 36 US ports are planning to strike on October 1, which could add downward pressure on LME zinc.
- Korea Zinc Inc. Takeover: South Korea’s Hanwha Group and LG Group may help Korea Zinc Inc. resist a takeover by MBK Partners Ltd. This acquisition could affect their partnership in future ventures like battery recycling.
Expert Opinion
- According to analysis, the MCX Zinc market is expected to show a mixed trend today. Zinc finds support at Rs 263.75, and a break below this level could lead to a test of Rs 261.20. On the upside, resistance is seen at Rs 271.10, and a move above that could push prices towards Rs 277.20.
Daily Market Report
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