Technically Zinc market is under fresh selling as market has witnessed gain in open interest by 3.04% to settled at 1527 while prices down 0.55 rupees.
Now MCX Zinc is getting support at 265.5 and below same could see a test of 262.9 levels, and resistance is now likely to be seen at 271.7, a move above could see prices testing 275.3.
Zinc yesterday settled down by 0.2% at 268.1 amid fears over COVID variant Omicron returned amid rising confirmed cases, and the hawkish signals from the Federal Reserve also suppressed the market sentiment.
The zinc inventory has been at a low level, supporting zinc prices. On the supply side, the overseas production was reduced amid high electricity prices, and domestic zinc ore supply also dropped.
The monthly TCs estimate has been revised down by 50 yuan/mt in metal content. It is expected that the zinc ingot output will lower by 10,000 mt. In China, the Caixin manufacturing PMI for November recorded 49.9, 0.7 lower than the estimate, indicating a slowing manufacturing recovery.
China’s factory activity unexpectedly picked up in November, growing for the first time in three months as raw material prices fell and power rationing abated, taking some pressure off a manufacturing sector grappling with soft demand.
The official manufacturing Purchasing Manager’s Index (PMI) was at 50.1 in November, up from 49.2 in October, data from the National Bureau of Statistics (NBS) showed.
The world’s second-largest economy, which staged an impressive rebound from last year’s pandemic slump, has lost momentum in the second half of the year as it grapples with a slowing manufacturing sector, debt problems in the property market and COVID-19 outbreaks.
–Zinc trading range for the day is 262.9-275.3.
–Zinc dropped amid fears over COVID variant Omicron returned amid rising confirmed cases.
–On the supply side, the overseas production was reduced amid high electricity prices, and zinc ore supply also dropped.
–In China, the Caixin manufacturing PMI for November recorded 49.9, 0.7 lower than the estimate.
Courtesy: Kedia Commodities
Source: Comodity Online