SMM Morning Review - 2010/5/13 Aluminum Market

SHANGHAI, May 13 (SMM) -- Yesterday, LME aluminum prices slipped first but advanced later due to fluctuating US dollar index. LME aluminum prices opened at USD 2,104/mt, with the highest level and the lowest level at USD 2,161.5/mt and USD 2,065/mt, respectively, and finally prices ended at USD 2,121/mt, up USD 16/mt compared with the previous trading day, or up 0.76%. Total trading volumes reported 259,082 lots, and total positions were 741,315 lots, up 2,437 lots. LME aluminum inventories declined by 7,275 mt to 4,488,500 mt.

The Wall Street Journal reported that Morgan Stanley is being probed by US federal prosecutors over allegations it misled investors about mortgage derivatives, causing its shares to plunge by 2.04%. The US Department of Commerce announced on Wednesday that its April budget deficit was USD 82.7 billion, the 19 consecutive monthly budget deficit and higher than March levels of USD 65.4 billion. In addition, Eurostat announced the 1Q GDP in Euro zone rose by 0.2% on a quarterly basis, better than previous forecast of a 0.1% rise. Economic data was mixed, and market concerns over the future economic trends of the Euro zone and fears on growing inflationary pressure in China still dominated the market, which directly allowed the US dollar index to move above 84.5.    

SHFE aluminum prices are expected to track the weak trend today, and market fundamentals failed to report improvement, and SMM predicts SHFE three-month aluminum contract prices will move between RMB 15,600-15,800/mt today, with prices expected to stand above the 5-day moving average.

To contact the writer on this report: angelawang@smm.cn

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