Zinc settled -1.79% down at 106.15 as concern grows over zinc warehousing situation in New Orleans as a large volume of canceled zinc warrants in London Metal Exchange-registered warehouses in New Orleans appear to be holding up other metals in the queue for delivery and are potentially contributing to their higher physical premiums in the US. Zinc is being canceled in New Orleans warehouses canceled warrants represent metal earmarked for removal and thus unavailable to the market additional metals, such as copper, are being added to warehouses. The zinc stock is then replenished, thus creating a deeper queue and less accessibility. Warehouse companies are obliged to deliver out a minimum amount of metal a day under LME rules. Trading volumes were thin as China is still on a public holiday. Investors are likely to look ahead to non farm payrolls data from the US, due on Friday, for indications of a recovery in the country's labour market. Sentiment surrounding the U.S. labour market was boosted in the previous session after data showed private sector hiring rose by a better than expected number in September. Activity in the vast services sector also picked up, suggesting the economy remained on track for modest growth. For today's session market is looking to take support at 105.4, a break below could see a test of 104.7 and where as resistance is now likely to be seen at 107.6, a move above could see prices testing 109.

Trading Ideas:

Zinc trading range for the day is 104.65-108.95.

Zinc settled -1.79% down at 106.15 as concern grows over zinc warehousing situation in New Orleans

ECB President said everything was in place for the bank to buy the bonds of troubled euro zone countries such as Spain.

Sentiment on the euro has been bolstered by hopes that Spain will soon request a bailout