SMM Morning Review - 2012/2/20 Aluminum Market

SMM Insight 09:33:34AM Feb 20, 2012 Source:SMM

SHANGHAI, Feb. 20 (SMM) – LME three-month aluminum hit a low of USD 2,150/mt and closed down USD 21.5/mt or 0.99% at USD 2,153.3/mt last Friday, as investors were still skeptical towards the second Greek bailout. Latest SHFE aluminum stocks increased 2,675 mt to 5,120,650 mt while total positions climbed 1,054 lots to 743,848 lots.

China’s latest reserve ratio cut on Saturday indicated extremely tight cash flow at banks. However, time is needed for the cut to bring noticeable support for the Chinese economy. Euro zone finance ministers will meet today to discuss the second Greek bailout plan. LME aluminum may see a slight rebound as a result of above development and move between USD 2,160-2,210/mt during today’s trading. The most active SHFE aluminum contract for delivery in May is expected to test support at the 5-day moving average and move between RMB 16,200-16,300/mt. Buying interest of downstream businesses and middlemen will pick up for lower prices, but sufficient supply will hold spot discounts over the SHFE current-month aluminum price between RMB 100-150/mt.

SMM Morning Review - 2012/2/20 Aluminum Market

SMM Insight 09:33:34AM Feb 20, 2012 Source:SMM

SHANGHAI, Feb. 20 (SMM) – LME three-month aluminum hit a low of USD 2,150/mt and closed down USD 21.5/mt or 0.99% at USD 2,153.3/mt last Friday, as investors were still skeptical towards the second Greek bailout. Latest SHFE aluminum stocks increased 2,675 mt to 5,120,650 mt while total positions climbed 1,054 lots to 743,848 lots.

China’s latest reserve ratio cut on Saturday indicated extremely tight cash flow at banks. However, time is needed for the cut to bring noticeable support for the Chinese economy. Euro zone finance ministers will meet today to discuss the second Greek bailout plan. LME aluminum may see a slight rebound as a result of above development and move between USD 2,160-2,210/mt during today’s trading. The most active SHFE aluminum contract for delivery in May is expected to test support at the 5-day moving average and move between RMB 16,200-16,300/mt. Buying interest of downstream businesses and middlemen will pick up for lower prices, but sufficient supply will hold spot discounts over the SHFE current-month aluminum price between RMB 100-150/mt.