SMM Brief on SHFE Aluminum Futures: Prices Plummeted on Renewed European Debt Crisis (2013-3-18)

SHANGHAI, Mar. 18 (SMM) – SHFE 1306 aluminum contract prices gapped lower at RMB 14,780/mt on March 18. Cyprus will impose tax on current bank deposits, triggering market panic. As a result, the most active SHFE aluminum contract dived to RMB 14,595/mt in early morning session, down as much as 1.65%. Finally, SHFE aluminum for June delivery shed RMB 155/mt or 1.04% to close at RMB 14,685/mt. Positions decreased 884 lots to 99,342 lots. The European debt crisis has once again hampered global economic recovery and sluggish aluminum consumption in China has further aggravated oversupply. In this context, the most-traded SHFE aluminum contract should meet growing resistance at RMB 14,700/mt for the near term.