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SMM Daily Review – 2011/7/29 Aluminum Market
Aug 1,2011 09:57CST
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Source:SMM
SHANGHAI, Aug. 1 (SMM) -- Most active SHFE 1110 aluminum contract prices opened lower at RMB 18,380/mt on July 29th.

SHANGHAI, Aug. 1 (SMM) -- Most active SHFE 1110 aluminum contract prices opened lower at RMB 18,380/mt on July 29th. After total positions sharply decreased by over 19,000 lots due to profit-making by the longs, SHFE 1110 aluminum contract prices plunged and hit RMB 18,200/mt. Finally closed price was RMB 18,210/mt, down RMB 245/mt or 1.33% from previous trading day. SHFE aluminum prices erased gains of the previous day to the RMB 18,200/mt mark after 3 successive days of rising. Falling aluminum prices in turn cooled down investor confidence and forced some longs to exit the market. However, support for aluminum prices at the 5-day moving average remained strong, and SMM expects aluminum prices to fluctuate in the short term. Latest SHFE aluminum inventories fell by 22,062 mt to 181,715 mt. Though aluminum prices fell, positive market fundamentals are expected to push up aluminum prices.

Morning mainstream traded prices of spot aluminum in Shanghai on July 29th were between RMB 18,450-18,550/mt, with premiums of positive RMB 40-60/mt over SHFE current-month aluminum prices. In the morning, as SHFE aluminum prices opened lower and moved downward with even short-term plunge reported, spot aluminum prices further dipped. Though goods holders increased their supplies, purchases were rare on the last trading day of July. Both suppliers and buyers have turned cautious after aluminum prices plunged. In the afternoon, SHFE current-month aluminum prices continued to fall, and spot aluminum prices followed with slight premiums. Mainstream traded prices were between RMB 18,350-18,380/mt. Market transactions were quite rare due to scarce purchases on Friday which was also the last trading day of July.


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