SMM Morning Review - 2012/3/1 Aluminum Market

SMM Insight 09:07:42AM Mar 01, 2012 Source:SMM

SHANGHAI, Mar. 1 (SMM) – LME three-month aluminum hit a high of USD 2,356/mt on Wednesday supported by European Central Bank’s capital injection and better-than-expected US economic data. The metal dropped below the USD 2,300/mt mark later, as Fed president Bernanke implied no more quantitative easing in the near term to send the US dollar index up 0.9%. Bargain hunting at the tail of trading helped the light metal pare losses to USD 2/mt or 0.03% to finally close at USD 2,325/mt.

Today’s market focus will be China’s February PMI which is expected to be higher than in January and consequently help slow losses in aluminum prices. As such, LME three-month aluminum is expected to test support at USD 2,300/mt and move between USD 2,300-2,350/mt during today’s trading. The most active SHFE three-month aluminum contract is expected to test RMB 16,300/mt as it swings between RMB 16,230-16,300/mt. Spot discounts over the SHFE current-month aluminum price are expected to stay between RMB 130-180/mt as downstream demand stays weak. Middlemen might actively buy spot and short futures to grab profits but trading is expected to remain light.

SMM Morning Review - 2012/3/1 Aluminum Market

SMM Insight 09:07:42AM Mar 01, 2012 Source:SMM

SHANGHAI, Mar. 1 (SMM) – LME three-month aluminum hit a high of USD 2,356/mt on Wednesday supported by European Central Bank’s capital injection and better-than-expected US economic data. The metal dropped below the USD 2,300/mt mark later, as Fed president Bernanke implied no more quantitative easing in the near term to send the US dollar index up 0.9%. Bargain hunting at the tail of trading helped the light metal pare losses to USD 2/mt or 0.03% to finally close at USD 2,325/mt.

Today’s market focus will be China’s February PMI which is expected to be higher than in January and consequently help slow losses in aluminum prices. As such, LME three-month aluminum is expected to test support at USD 2,300/mt and move between USD 2,300-2,350/mt during today’s trading. The most active SHFE three-month aluminum contract is expected to test RMB 16,300/mt as it swings between RMB 16,230-16,300/mt. Spot discounts over the SHFE current-month aluminum price are expected to stay between RMB 130-180/mt as downstream demand stays weak. Middlemen might actively buy spot and short futures to grab profits but trading is expected to remain light.