SHANGHAI, Jun. 11 (SMM) – Despite a 0.25% interest rate cut by the Chinese central bank, the most active SHFE aluminum contract for September delivery opened lower at RMB 15,895/mt and settled down RMB 35mt or 0.22% at RMB 15,865/mt on Friday, as losses in LME aluminum proved more destructive. The rate cut failed to boost confidence, with futures still trending lower. Investors were waiting for a direction from May’s economic data to be delivered the weekend. The market sentiment is expected to remain slightly bearish, however, and the most active aluminum contract is expected to test support at RMB 15,800/mt.
Spot aluminum was traded at RMB 15,880-15,900/mt in Shanghai, with low-iron aluminum trading at RMB 15,990-16,020/mt. The rate cut failed to help metals prices gain while negative news from Europe and the US led to lower SHFE aluminum prices. Bearishness was strong in the spot market, with traders actively moving goods to avoid further losses if prices continue to dip. Buying was weak in Shanghai. A few liquidity-tight traders even lowered quotations to RMB 15,800/mt. Spot aluminum prices in Wuxi and Hangzhou were little changed as downstream buyers replenished stocks when prices were low, with traded volumes up slightly.