Zinc settled up 0.78% at 128.6 after release of stronger-than-expected US manufacturing data. On Wednesday, poor data from Germany and lower new lending in China ignited concerns over metal demand from the two countries causing prices to drop earlier in the day. Such trend was reversed after the World Bank raised its projection for global growth and due to upbeat US PPI and Empire State manufacturing index which gave a boost to the US stocks and base metals. The NY Fed's Empire State manufacturing index advanced to 12.51 in January, well above 3.5 expected. The index, which has indicated sluggish manufacturing for the past five months, jump to a high never seen since May 2012 due to new orders sub-index climbing to 10.98. The US PPI for January rose at an expected pace and presented the largest gain since June 2013. The Fed's Beige Book reported the US economy continued to grow at a moderate pace from late November through the end of 2013, helped by rising consumer spending, improving job market, and strong manufacturing. These data drove the US stock market into a rebound. Market was optimistic on manufacturing index to be released by the Philadelphia Fed, which may herald upbeat ISM index, in turn lifting stock prices and commodities. Technically market is under fresh buying as market has witnessed gain in open interest by 0.24% to settled at 2952 while prices up 1 rupee, now Zinc is getting support at 126.9 and below same could see a test of 125.2 level, And resistance is now likely to be seen at 129.6, a move above could see prices testing 130.6.

Trading Ideas:

Zinc trading range for the day is 125.2-130.6.

Zinc ended with gains after release of stronger-than-expected US manufacturing data.

Fed's Beige Book report also showed the U. S. economy kept growing at a moderate pace from late November through the end of 2013

Zinc daily stocks at Shanghai exchange came up by 200 tonnes