S&P US August Manufacturing PMI Hits Recent Low; Domestic Aluminum Inventory Destocking Slows [SMM Aluminum Morning Comment]

SMM, Aug 23: Overnight, the most-traded SHFE aluminum 2410 contract opened at 19,840 yuan/mt, hit a high of 19,880 yuan/mt, a low of 19,745 yuan/mt, and closed at 19,825 yuan/mt, down 45 yuan/mt or 0.22%. Overnight, LME 3M aluminum opened at $2,482/mt, hit a high of $2,531/mt, a low of $2,466/mt, and closed at $2,466.5/mt, down $14.5/mt or 0.58%.
Macro side, the S&P Global's US Manufacturing PMI index was lower-than-expected, while weekly jobless claims slightly exceeded expectations, providing data support for the US Fed's upcoming monetary policy decisions. Several Fed officials have indicated that a rate cut is imminent, making it a likely event. On the fundamentals, domestic aluminum ingot inventory continues to decline, but the destocking speed has slowed due to the aluminum price rebound, leading to increased market caution. Meanwhile, domestic aluminum supply remains stable, with only sporadic resumption of production expected in the future. Additionally, downstream consumption is expected to improve, boosted by car trade-in programs and real estate policies. Recently, external macro sentiment has been relatively positive, and the supply-demand mismatch has somewhat eased. SMM expects short-term aluminum prices to have upside potential, with continued attention needed on macro sentiment changes and the sustainability of downstream aluminum consumption.