Zinc settled flat amid ongoing concerns over global economic growth prospects, which in turn have triggered worries over demand. US major economic data released later in the day was mostly below expectations, with the number of preliminary jobless claims increasing to 360,000. But a US Federal Reserve official reported the Fed will contract stimulus policy starting this summer, weighing down the US dollar index and inducing investors to enter the market. The Ministry of Commerce Thursday announced the foreign direct investment was USD 8.44 billion in April, up 0.4% YoY, well below market estimate and the previous data. The slight increase in FDI against high funds outstanding for foreign exchange highlights the great pressure from inflows of hot money. The US building permits for April were reported better than expectation and exceeded previous levels overnight, but the April housing starts, CPI, initial and continuing jobless claims last week were all reported disappointing, cooling down market expectations to termination of QE. The People’s Bank of China issued RMB 40 billion in 28-day repurchase and issued RMB 17 billion in 91-day Central Bank Bills on Wednesday. However, open market operations could do little to prevent inflows of “hot money”. Markets are expecting China’s  central bank to cut interest rate as this is more effective in blocking hot money.  Technically market is under fresh selling as market has witnessed gain in open interest by 1.81% to settled at 7952 while prices remain unchange0 rupee, now Zinc is getting support at 98.7 and below same could see a test of 98.08 level, And resistance is now likely to be seen at 100.0, a move above could see prices testing 100.58.

Trading Ideas:

Zinc trading range for the day is 98.08-100.58.

Zinc settled flat amid ongoing concerns over global economic growth prospects, which in turn have triggered worries over demand

US major economic data released was mostly below expectations, with number of preliminary jobless claims increasing to 360,000.

US Federal Reserve official reported the Fed will contract stimulus policy starting this summer, weighing down the US dollar index