FREE COMMODITY ZINC NEWS 30-12-2016
Zinc on MCX settled down -3.13% at 170.45 slipped as profit-taking set in after previous gains. Sentiments also dropped as China’s demand for the metal is expected to slow down in the course of 2017, as Beijing takes steps to dampen the country’s property market because the measures will have knock-on effects on the growth in sales of household appliances and automatic vehicles. It was the growth in China’s real estate and automatic vehicles industries that drove up zinc demand by 2% in 2016. It is all a far cry from 2016, when zinc was definitely the most dazzling performer among the base metals and its prices on the Shanghai Futures Exchange and London Metal Exchange rocketed by 86% and 90%, respectively, in the course of the year, underpinned by the shutdowns of Glencore, Century and Lisheen zinc mines towards the end of 2015. The global cuts were helped by Chinese cuts, when, in November 2015, in response to falling prices and the global mine suspensions, ten major Chinese zinc smelters met and agreed to cut 2016 production by 500,000 tonnes, about 3.5% of global zinc output. The year ahead is likely to be extremely tough for China’s zinc smelters as they are squeezed between severe tightness in concentrate supply and a decline in the growth of demand for zinc metal, hitting spot prices. Technically market is under long liquidation as market has witnessed drop in open interest by -32.17% to settled at 2380 while prices down -5.5 rupee, now Zinc is getting support at 168.7 and below same could see a test of 166.7 level, And resistance is now likely to be seen at 174.1, a move above could see prices testing 177.5.
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Zinc on MCX settled down -3.13% at 170.45 slipped as profit-taking set in after previous gains. Sentiments also dropped as China’s demand for the metal is expected to slow down in the course of 2017, as Beijing takes steps to dampen the country’s property market because the measures will have knock-on effects on the growth in sales of household appliances and automatic vehicles. It was the growth in China’s real estate and automatic vehicles industries that drove up zinc demand by 2% in 2016. It is all a far cry from 2016, when zinc was definitely the most dazzling performer among the base metals and its prices on the Shanghai Futures Exchange and London Metal Exchange rocketed by 86% and 90%, respectively, in the course of the year, underpinned by the shutdowns of Glencore, Century and Lisheen zinc mines towards the end of 2015. The global cuts were helped by Chinese cuts, when, in November 2015, in response to falling prices and the global mine suspensions, ten major Chinese zinc smelters met and agreed to cut 2016 production by 500,000 tonnes, about 3.5% of global zinc output. The year ahead is likely to be extremely tough for China’s zinc smelters as they are squeezed between severe tightness in concentrate supply and a decline in the growth of demand for zinc metal, hitting spot prices. Technically market is under long liquidation as market has witnessed drop in open interest by -32.17% to settled at 2380 while prices down -5.5 rupee, now Zinc is getting support at 168.7 and below same could see a test of 166.7 level, And resistance is now likely to be seen at 174.1, a move above could see prices testing 177.5.
