SHANGHAI, Jan. 10 (SMM) – Alcoa’s Q4 earnings report shows that the company posted better-than-expected profits in 4Q following a loss-making Q3. Meanwhile, Alcoa is optimistic towards consumption growth in 2013. In response, LME aluminum staged a strong rally overnight, breaking resistance at USD 2,100/mt to a high of USD 2,107/mt. However, LME aluminum trimmed some gains and retreated below all moving averages at the tail of trading as investors took profits prior to the release of China’s trade figures. Finally, LME aluminum closed USD 12.5/mt or 0.61% higher at USD 2,077.5/mt. Latest LME aluminum inventories decreased 10,025 mt to 5,196,650 mt.
Market is awaiting China’s December trade figures. LME aluminum should struggle at USD 2,080/mt and fluctuate in the band of USD 2,060-2,100/mt on Thursday. The SHFE 1303 aluminum contract is expected to open slightly higher at RMB 15,285/mt, with prices between RMB 15,230-15,330/mt. Traders will actively move goods at prices flat with the current-month contracts, but downstream producers and middlemen should purchase limited amounts, with spot discounts expected between RMB 0-40/mt.