SHANGHAI, Jul. 29 (SMM) – US Consumer Confidence Index jumped to a 6-year high at 85.1 in July, but this failed to give a great boost to investor sentiment. This is because the IMF urged greater clarity from the US Federal Reserve over its QE3 exit stance. A lack of Fed clarity will lead to a spike in borrowing costs that could jeopardize US and global economic recovery. Slowing Chinese economy also triggered worries over sagging demand from the world’s top metal consumer, weighing commodity prices down. LME aluminum retreated from all moving averages to below USD 1,800/mt during the European session last Friday, and closed at USD 1,798.5/mt, down USD 25.5/mt or 1.40%. Positions decreased 954 lots to 737,359 lots. LME aluminum inventories increased 19,150 mt to 5,483,175 mt.
Aluminum prices will drop on bearish sentiment, with LME aluminum moving within USD 1,760-1,800/mt on Monday, and with SHFE 1310 aluminum contract fluctuating between RMB 14,200-14,300/mt after opening lower at RMB 14,260/mt. In spot market, consumption will be sluggish, with spot discount of RMB 0-30/mt and premium of RMB 0-10/mt expected over SHFE 1308 aluminum contract prices.