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Selling Recommended For Zinc

ByCommodityOnline
Published 02/24/2014, 04:18 AM
Updated 05/14/2017, 06:45 AM


--Zinc inventories have been broadly declining since last two to three weeks and the average daily fall in their inventories is around 4000 MT. However there has been mixed cues from the inventory picture where in cancelled warrants have been falling along with the inventories. The cancelled warrants for the commodity have declined from 382,100 MT to 210,400 MT in the last twenty six trading sessions.

--There is no major fundamental development pertaining to Zinc and there is no change in the zinc physical premiums. The decline in new mine supplies and closure of existing zinc mines bodes well for the over the medium term Perspective. For the week we have a ranged view on the commodity.

--During the day we recommend selling zinc from the higher levels as the commodity might take negative cues from the news that the China`s industrial bank has restricted lending to property sector related industries like steel which may indirectly have a negative impact on Zinc as the commodity is used in the process of galvanization for rust-proofing the steel. As the day progresses we have economic data from Euro-Zone which are expected to be on the weaker side which may further pressurize the metal to trade lower. During the US session, we have regional manufacturing gauges which might weaken further. Overall we hold a bearish on zinc for the day.

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