SHANGHAI, Apr. 23 (SMM) – The US existing home sales dropped 0.6% in March to an annualized 4.92 million units, far below expectations. The consumer confidence index in the euro zone was in negative territory, but did improve some from previous reading. This eased market worries and forced the US dollar index to surrender gains during the European session. In response, LME aluminum jumped from USD 1,869/mt to above USD 1,890/mt at the tail of trading. Gains were limited by resistance the 20-day moving average, though. Finally, LME aluminum closed 0.58% higher at USD 1,893/mt. Latest LME aluminum inventories decreased 9,225 mt to 5,176,850 mt.
Aluminum prices will remain low as markets are expecting slower growth in HSBC’s China April PMI, which is due today. LME aluminum will continue to meet resistance at USD 1,900/mt, with prices between USD 1,850-1,895/mt on Tuesday. SHFE 1306 aluminum contract is expected to open slightly higher at RMB 14,550/mt and move in a RMB 14,480-14,580/mt range. Severe oversupply will leave spot aluminum at a discount of RMB 70-110/mt over SHFE 1305 aluminum contract.