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Robust physical demand powers Zinc rally

By Religare
|

Zinc futures rose in the domestic market on Wednesday as investors and speculators booked fresh positions in the industrial metal amid a pickup in physical demand for Zinc in the domestic spot market.

Further, the sharp losses in the metal in the previous session when Zinc slid by 2.5 per cent amidst concerns over reduced demand prospects from China, the world's biggest metals consumer following the massive Yuan devaluation last week and slowing economic growth offered traders, good bargain buying opportunity in Zinc, at existing levels.

 

China's benchmark index, the Shanghai Composite which recovered on Wednesday had plunged over 6 per cent on Tuesday, raising concerns over the deteriorating health of the world's second biggest economy, even as the country's central bank made the biggest cash injection in the country's financial system on a single-day basis in 19 months. Speculation is rife that China's recent stock and currency market turmoil which has rattled investor confidence may spread to other parts of the economy, curbing metal demand.

At the MCX, Zinc futures for August 2015 contract closed at Rs per 116.75 1 kg, up by 0.91 per cent after opening at Rs 115.90, against the previous closing price of Rs 115.70. It touched the intra-day high of Rs 117.15.

Story first published: Thursday, August 20, 2015, 12:30 [IST]
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