SMM Morning Review - 2011/4/8 Aluminum Market

SHANGHAI, Apr. 8 (SMM) -- The European Central Bank lifted interest rates by 25 basis points to 1.25% as market expected, and the news failed to drive up the euro versus the US dollar since market players have absorbed this news. Later, the US Labor Department announced that the initial jobless claims fell to 382,000 last week, down 10,000 from a week earlier. The better-than-expected employment data helped push up the US dollar index, but later a major aftershock measuring 7.4 magnitude hit northeast Japan on Thursday evening, triggering large-scale sell-offs in the market. As a result, the US dollar index lost previous gains, and finally closed at 75.585, up 0.011 compared with the previous trading day.

LME aluminum prices opened at USD 2,671/mt, and later strengthened supported by soaring crude oil prices and a weaker US dollar caused by the European Central Bank’s interest rate increase, with the highest level reported at USD 2,694.3/mt, again setting a new high. At the end of trading, the 7.4 magnitude aftershock in northeast Japan triggered panic sell-offs in the market, dragging down LME aluminum prices to close at USD 2,680/mt, up USD 7.5/mt or 0.28% compared with the previous trading day. Total positions increased by 5,739 lots to 738,282 lots.

Today, low-end LME aluminum prices are expected to climb slightly to above USD 2,650/mt, with prices expected to test the resistance at USD 2,700/mt. SHFE 1106 aluminum contract prices are expected to climb gradually after opening slightly higher, with prices expected to struggle at RMB 16,900/mt. Spot aluminum prices are expected to inch up to stand steady at above RMB 16,600/mt. 

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