Zinc’s three-month price rallied throughout the afternoon to breach its nearby $2,500-per-tonne resistance level and close at its highest level since December 20, 2018 despite choppy trading throughout the week.
Market participants are closely watching zinc’s forward curve after its cash/three-month spread narrowed from a $77 per tonne backwardation last week, to just $1.50 per tonne this week. The spread was recently seen in a backwardation of $8.50 per tonne.
Meanwhile, aluminium’s volumes traded were the most in the complex at 14,210 lots traded over the day, while the metal’s three-month price action remains subdued below $1,900 per tonne after news that the US Treasury Department is considering the removal of sanctions against UC Rusal.
“If you look at aluminium, it's going to be sideways trading for a while - the market has already factored in [sanctions against] Rusal being removed...