SMM Morning Review - 2012/5/25 Aluminum Market-Shanghai Metals Market

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SMM Morning Review - 2012/5/25 Aluminum Market

SMM Insight 10:28:06AM May 25, 2012 Source:SMM

SHANGHAI, May 25 (SMM) – Manufacturing contractions in China, Europe and the US and lasting worries towards Greece’s euro exit continued to weigh on markets. US April durable goods orders reported positive, though lower-than-expected, growth, helping base metals rebound. LME aluminum settled up slightly by USD 2.5/mt or 0.12% at USD 2,010/mt. Positions surged 11,000 lots and strong support was found at USD 2,000/mt. Latest aluminum stocks in LME-bonded warehouses added 3,350 mt to 4,956,325 mt.

The panic is gradually waning though real support is lacked. Aluminum prices will remain range-bound today. LME aluminum is expected to test 5-day moving average resistance and move between USD 2,000-2,030/mt. The most active SHFE aluminum contract for September delivery should hover between RMB 15,920-16,000/mt. Spot aluminum demand is still weak, especially at the month’s end, while supply has been sufficient to curb premiums. Spot discount should be within RMB 10/mt and premiums within RMB 30/mt. Stock replenishing demand is weak before the weekend and the traded volume therefore should remain light.

SMM Morning Review - 2012/5/25 Aluminum Market

SMM Insight 10:28:06AM May 25, 2012 Source:SMM

SHANGHAI, May 25 (SMM) – Manufacturing contractions in China, Europe and the US and lasting worries towards Greece’s euro exit continued to weigh on markets. US April durable goods orders reported positive, though lower-than-expected, growth, helping base metals rebound. LME aluminum settled up slightly by USD 2.5/mt or 0.12% at USD 2,010/mt. Positions surged 11,000 lots and strong support was found at USD 2,000/mt. Latest aluminum stocks in LME-bonded warehouses added 3,350 mt to 4,956,325 mt.

The panic is gradually waning though real support is lacked. Aluminum prices will remain range-bound today. LME aluminum is expected to test 5-day moving average resistance and move between USD 2,000-2,030/mt. The most active SHFE aluminum contract for September delivery should hover between RMB 15,920-16,000/mt. Spot aluminum demand is still weak, especially at the month’s end, while supply has been sufficient to curb premiums. Spot discount should be within RMB 10/mt and premiums within RMB 30/mt. Stock replenishing demand is weak before the weekend and the traded volume therefore should remain light.