Zinc strategy viewpoint

Zinc prices fluctuated in a narrow range yesterday, paying attention to the interference of macro mood changes on prices. On the supply side, the refinery inventory is relatively abundant, the average raw material reserve is about one month, and the start-up of smelter production is still relatively active. In terms of demand, galvanized tubes sell well, while enterprises in northern Hebei and Shandong basically return to normal due to environmental protection, driving the operating rate of galvanizing up, while domestic orders for galvanized structures do not show a good performance for the time being. On the whole, the zinc price is restricted by factors such as macro pressure and the expectation of an increase in overseas supply, while the lower part is supported by low inventory, and the range of zinc price fluctuates mainly in the short term. It is suggested that it should be treated with the idea of selling high and absorbing low. Follow-up domestic and foreign policy changes and changes in relevant economic data will still be one of the factors that dominate zinc prices in the future, and we need to pay attention to the changes in market expectations of economic trends.

strategy

Unilateral: neutral. Arbitrage: neutral.

Risk

1. The change of overseas smelting capacity. 2. Domestic consumption is lower than expected. 3. Liquidity tightened faster than expected.

Aluminum strategy viewpoint

Aluminum prices were mainly volatile yesterday, recently affected by external macro factors, the market wait-and-see mood is strong. In terms of domestic supply, the operating capacity of electrolytic aluminum has been slightly repaired upward, and electrolytic aluminum enterprises in Sichuan, Guizhou and other areas have resumed production slightly, but the speed of increasing production is slower and the supply pressure is smaller. Demand-side consumption slowly recovers, from a sub-section point of view, although the performance of aluminum alloy plate due to poor terminal consumption is relatively general, the market demand of aluminum plate, strip and foil continues to warm up, and the start-up data of aluminum profile and cable plate are relatively bright. Among them, the orders of infrastructure engineering and industrial profiles related to building profiles have a good performance, and it is expected that the overall operating rate will continue to grow in the short term. In the follow-up, we need to pay attention to the recovery process of terminal demand such as automobile, construction and so on. Generally speaking, the aluminum market has recently been greatly disturbed by macro emotions, the supply side of the fundamentals has been slightly repaired, while downstream consumption has gradually improved, social inventory has entered the destocking cycle, the fundamentals are well supported, and short-term aluminum prices are suggested to wait and see. pay attention to the interference of macro sentiment on prices.

strategy

Unilateral: neutral. Arbitrage: neutral.

Risk

1. The change on the supply side is higher than expected. 2. The recovery of domestic consumption is not as good as expected. 3. Liquidity tightened faster than expected.