Zinc prices concluded the trading session with a 1.92% increase, reaching Rs 366.65. This uptick was bolstered by a resurgence in global manufacturing activity and a tightening of supply conditions in the near term. Manufacturing data from China, Europe, and the United States indicated continued expansion despite elevated input costs, reinforcing expectations for steady industrial metals demand. Zinc inventories in warehouses monitored by the Shanghai Futures Exchange decreased by 2.2% over the week, indicating a strengthening in physical demand.

Meanwhile, US manufacturing activity continued to exhibit expansion for the sixth consecutive month in June, although the rate of growth experienced a slight moderation from May’s four-year peak. On the supply side, market sentiment continued to be bolstered by operational disruptions at various key producers. Glencore’s Kazzinc facility in Kazakhstan has been operating at a diminished capacity subsequent to an explosion, whereas Nexa’s Cajamarquilla smelter in Peru is in the process of gradually resuming operations following a shutdown due to a fire. Concerns continue to linger regarding diminished output at Boliden’s Garpenberg mine in the wake of prior seismic events.

Despite a 9.4% year-on-year increase in zinc production in China during May, the International Lead and Zinc Study Group maintains its forecast of a 19,000-ton refined zinc deficit for the year. Recent data from the ILZSG revealed that the global zinc market surplus significantly decreased to 26,500 metric tonnes in April, down from 56,300 metric tonnes in March, suggesting a positive shift in market fundamentals. Goldman Sachs anticipates a modest global surplus in 2026; however, it projects a notable tightening of supply outside China in 2027 and 2028, driven by a deceleration in mine supply growth alongside a steady increase in demand.

From a technical perspective, the market exhibits renewed buying interest, as evidenced by a 6.7% increase in open interest alongside a Rs 6.9 rise in prices, suggesting the establishment of new long positions. Immediate support is identified at Rs 363.1, with subsequent support at Rs 359.5, while resistance is established at Rs 368.6. A sustained move above this level could extend gains towards Rs 370.5.