SMM Morning Review - 2010/5/21 Aluminum Market

SHANGHAI, May 21 (SMM) -- Yesterday, LME aluminum prices opened at USD 2,015/mt, with the highest level and the lowest level at USD 2,036/mt and USD 1,950/mt, respectively, and finally prices ended at USD 1,992/mt. Total trading volumes reported 163,872 lots, and total positions were 706,326 lots, down 6,361 lots. LME aluminum inventories increased by 39,075 mt to 4.5887 million mt.

Germany regulators banned on naked short selling and naked credit-default swaps of euro-area government bonds, triggering market concerns over whether or not the European leaders can cooperate to weather the sovereign debt crisis in the future. Meanwhile, large amounts of speculative funds flowed out of the Europe, exerting strong selling pressure on the European stocks, and the European stock markets plunged as a result last night.

The US Department of Labor announced that the US initial claims for jobless benefits increased by 25,000 to 471,000 in the week ended on May 15th, far higher than the estimated level of 440,000, hitting a one-month high, while the jobless claims were revised to 446,000 from the initial 444,000 in a week earlier. Average initial claims for jobless benefits over the past four weeks increased by 3,000 to 453,500. The deteriorating employment data generated market panic, and the US stocks closed with decline as well last night, showing strong selling pressure on base metals markets. LME aluminum inventories have increased significantly for three consecutive days, with total inventories almost reaching 4.6 million mt, and LME aluminum prices failed to stand above the USD 2,000/mt mark as a result. 

SHFE aluminum prices are expected to open lower today, with SHFE three-month aluminum contract prices expected to test the RMB 15,000/mt mark.       

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

Copyright © SMM. All Rights Reserved

None of this material may be used for any commercial or public use in any forms or means, without the prior written consent of SMM. For reproduction issue, please contact us by email: service.en@smm.cn