SHANGHAI, Aug. 6 (SMM) – Three-month aluminum on the London Metal Exchange slumped to USD 2,006/mt after opening at USD 2,023/mt on Tuesday as negative news flooded in. China’s service PMI, compiled by HSBC/Markit, fell to 50.0 in July, the lowest reading since November 2005, suggesting still fragile recovery in the broader economy. Positive US non-manufacturing PMI released by the ISM and factory orders for June sparked fear about imminent interest rate hike. Growing Russia-Ukraine tensions also soured market sentiment. Finally, the light metal ended USD 19.5/mt lower at USD 2,012.8/mt. Trading volumes were down 5,766 lots to 11,106 lots, with position up 8,097 lots to 925,688 lots. 

 

On Tuesday night, SHFE 1410 aluminum contract moved sideways after starting at RMB 14,075/mt, and finished the night session at RMB 14,080/mt. Trading volumes totaled 30,882 lots, with positions down 1,058 lots to 155,904 lots. 

 

The macro front will be relatively quiet today, with the most active SHFE aluminum contract expected to fluctuate between RMB 14,050-14,100/mt. In China’s physical market, cargo holders will be eager o sell at highs, with spot discounts of RMB 0-40/mt are expected over SHFE 1408 aluminum contract.