Zinc Prices Surge Across Global Markets

Zinc Price

• LME: As of yesterday, LME zinc opened at $2,786/ton, hitting a high of $2,870/ton and low of $2,782/ton, ultimately closing up at $2865/ton, a rise of $68/ton, or 2.43%. Today, LME Zinc trading commenced at $2,869/ton.
• SHFE: As of yesterday, the most-traded SHFE 2410 zinc contract opened at 23,645 yuan/ton, reaching a high of 23,800 yuan/ton and low of 23,585 yuan/ton, finally closing up at 23,800 yuan/ton, a rise of 230 yuan/ton, or 0.98%. Today, SHFE Zinc trading commenced at 23,815 yuan/ton.
• MCX: As of yesterday, zinc prices opened at Rs 260/kg, reached the highest level of Rs 264.70/kg, the lowest level at Rs 259.75/kg and finally closed down at Rs 264.45/kg, a rise of Rs 5.15 or 1.99%. Today, MCX Zinc trading commenced at Rs 264.60/kg.

Zinc Supply & Demand

• LME Opening Stock - 232425 | Live Warrants - 204425 | Cancelled Warrants - 28000
• LME: Trading volume decreased to 13,347 lots, while open interest increased by 410 lots to 236,000 lots. LME zinc recorded a bullish candlestick overnight, with support from the middle Bollinger Band; LME zinc stocks decreased by 300 ton to 232,425 ton, a drop of 0.13%. Market expectations of a US Fed rate cut remained strong, easing concerns over economic slowdown and driving zinc prices higher, with LME zinc continuing to rise.
• SHFE: Trading volume decreased to 54,876 lots, while open interest increased by 189 lots to 81,240 lots. Overnight, the SHFE zinc also recorded a bullish candlestick, with support from the 40-day moving average. SMM reported that the social inventory of zinc ingots fell by 4,200 ton to 113,400 ton WoW on Thursday, indicating ongoing stock depletion. Additionally, the rise in ferrous metals prices supported a slight resumption in galvanizing production this week, coupled with macroeconomic optimism, driving SHFE zinc higher as well.
• MCX: Zinc prices rose by 1.99% to settle at Rs 264.45, driven by optimism over a potential interest rate cut from the U.S. Federal Reserve. China's export growth moderated in August 2024, increasing by 4.6% year-on-year, while imports rose by 2.5%, exceeding expectations but slowing from the previous month. On the supply front, zinc inventories in LME warehouses increased to 217,575 tons by the end of August, with Spain-origin zinc making up the largest portion at 38.7%, followed by India-origin zinc at 63,050 tons and Australia-origin zinc at 21,875 tons.

Zinc News

• Domestic Zinc Ingot Stock Continues to Deplete; SHFE Zinc Surges Higher.
• Zinc Rises on Optimism Over a Likely Federal Reserve Interest Rate Cut This Month.
• US PPI and core PPI MoM both exceeded expectations but previous values were revised down; US initial jobless claims moderately rose to 230,000 last week.
• The ECB (European Central Bank) cut rates for the second time this year and lowered GDP growth projections for the next three years while inflation expectations remained unchanged.

Expert Opinion

• The zinc market saw fresh buying activity, with open interest rising by 1.67% to 2,129 contracts as prices increased by Rs 5.15. Zinc is currently finding support at Rs 261.3, with a potential test of Rs 258 if breached. On the upside, resistance is expected at Rs 266.3, and prices could test Rs 268 if resistance is broken.