SHANGHAI, May 11 (SMM) – US non-farm payrolls were 223,000, basically in line with expectations. China’s imports and exports fell in April, raising hopes for stimulus. LME aluminum rose to USD 1,908.5/mt after opening at 1,875/mt last Friday. But prices fell to below the 10-day moving average later on risk aversion before the weekend, and ended at USD 1,888/mt. Trading volumes were down 4,731 lots to 12,374 lots, and positions were down 9,274 to 796,000.
Last Friday night, SHFE 1507 aluminum contract fell to RMB 13,425/mt after starting at RMB 13,455/mt. The contract finished the night session at RMB 13,445/mt. Trading volumes totaled 13,062 lots, and positions were down 1,026 to 135,112.
The PBOC announced interest rate cut this past weekend, but this move came as no surprise. The cut suggests that the Chinese economy is weak, so it will have limited impact on base metals market. SHFE 1507 aluminum contract might face selloffs at highs, and move between RMB 13,440-13,500/mt on Monday. In China’s spot market, spot discounts of RMB 180-220/mt are expected over SHFE 1505 aluminum contract.