LME zinc and other base metals rebounded on Monday as investors rallied after Friday’s sell-off, and China’s strong economic data also supported the market.
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But analysts said the base may still face a deep correction, since early June to early September rose since.
Robin Bhar, head of metal research at Societe Generale in France, said the market was still cautious, mainly because it was bargain-hunting to push up the market.
Bhar said the metals are expected to fall 5% -10% from the recent highs in the coming weeks or months.
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Saturday released the Chinese data to support the market. Data show that China’s August inflation data are more than expected, CPI rose a seven-month high, one year to maintain positive growth PPI also hit a four-month high.
Three-month zinc rose 2.3 percent to $ 3,102 a tonne, down 3.1 percent on Friday.