BEIJING, July 18 (Reuters) - Zinc prices on Wednesday pulled
away from one-year lows hit earlier in the week and the metal
recorded its first daily jump in seven trading days in Shanghai,
tracking a rise on the London Metal Exchange (LME) amid plunging
inventories.
Shanghai Futures Exchange (ShFE) zinc stocks ZN-STX-SGH
dropped by 16,919 tonnes to 58,016 tonnes last week, their
lowest since February 2008, while LME zinc stocks MZN-STOCKS
have fallen for six straight days.
Zinc, used to galvanise steel, is down 10.1 percent so far
this month in Shanghai and 11.3 percent in London on concerns
about oversupply, but ANZ said it had been boosted by positive
data from top metals consumer China on Tuesday.
The metal has "found support after the Chinese house price
data reading rose at its fastest pace in 21 months," ANZ wrote
in a note, adding that zinc was "one of the metals most
leveraged to the housing and construction sectors."
FUNDAMENTALS
* SHANGHAI ZINC: The most-traded September zinc contract on
the ShFE rallied late in the session to close 2.4
percent higher at 20,725 yuan ($3,089.09) a tonne, above
Tuesday's one-year low of 20,055 yuan a tonne. It traded lower
10 of the previous 13 trading days.
* LME ZINC: Three-month zinc on the LME had a mixed
session but was trading up 0.8 percent at $2,531.50 a tonne, as
of 0711 GMT, extending a 1.5-percent jump in the previous
session after hitting a one-year low of $2,573.85 on Monday.
* GRAPHIC: Expectations for a rise in zinc concentrate
supplies in coming years have driven down the metal price in
London to one-year lows, but smelting capacity constraints
suggest the sell-off is premature.
* ZINC: Commerzbank analysts said on Tuesday they thought
the recent zinc price slide was excessive. "While last year's
supply deficit of 460,000 tonnes is set to decline to around
260,000 tonnes this year, it nonetheless remains sizeable," they
wrote in a note.
* COPPER: Shanghai copper closed down 1.2 percent
at 48,260 yuan a tonne, while London copper was trading
down 0.6 percent at $6,116.50 a tonne as the dollar index
strengthened.
* VEDANTA: India's southern state of Tamil Nadu will ask the
nation's environment court to dismiss a Vedanta Ltd
petition seeking to reopen its copper smelter, a lawyer
representing the state government said on Wednesday.
* BRAZIL; Norsk Hydro ASA said its Paragominas
bauxite mine in Brazil would temporarily suspend work contracts
for 80 employees for up to five months from Friday, and reduce
the number of contractors by 175 in the coming weeks.
