[summary of the Morning meeting inside SMM Aluminum] Air conditioning foil shows warming up, electrolytic aluminum society inventory is strong to go to the warehouse.

5.22 minutes of SMM Internal Aluminium Morning meeting

Market: on Thursday, the Shanghai Aluminum Company 2007 contract opened at 12950 yuan / ton in the morning, rose to 13020 yuan / ton during the day, closed at 12775 yuan / ton during the day, and opened at night to try to repair the daytime decline, closing at 12880 yuan / ton. On Thursday, Lun Aluminum opened at US $1513 per tonne and closed at US $1521 per tonne, up US $6 per tonne, or 0.4 per cent.

Macro: (1) overseas, US Treasury Secretary Mnuchin said that the road to recovery from the epidemic in the United States is difficult, and Congress is very likely to need to pass more stimulus bills (bearish banks); IMF president said that banks need to collectively suspend dividend payouts and share buybacks in order to enhance the resilience of the financial system and withstand the impact of the epidemic. (2) on the domestic front, the session of the National people's Congress opened this morning, at which a report on the work of the government will be delivered; in April, the main economic indicators improved, with the output of 10 non-ferrous metals reaching 4.93 million tons, an increase of 3.8 per cent over the same period last year (Ledox). According to the Ministry of Industry and Information Technology, the epidemic has a greater impact on small and medium-sized enterprises, and it is necessary to speed up the implementation of policies such as tax reduction and fee reduction and financial support.

Fundamentals: (1) in terms of alumina, trading in the domestic market is light, the scale just needs to be closed, electrolytic aluminum plants mostly hold a wait-and-see attitude, SMM alumina regional weighted price has not changed for a week, at 2206 yuan / ton (neutral); (2) in terms of inventory, according to SMM statistics on Thursday, the weekly inventory of electrolytic aluminum in China decreased by 79000 tons to 979000 tons, maintaining a strong de-stocking trend, the arrival of goods from the main places of consumption did not rise significantly, and consumption was just needed in the lower reaches of East and South China. But at the same time, the speed of going to the warehouse began to slow down during the week, and some large aluminum mills began to sell hidden inventories before, forming double pressure on spot rising water and futures (bearish); (3) SMM survey shows that air-conditioning foil has obviously warmed up month-on-month since May, processing fees have also risen, individual leading enterprises began to take the initiative to increase air-conditioning foil products, mainly due to improved terminal demand (bullish).

Spot: on Thursday morning, some spot quotations in Wuxi, Shanghai, were between 13450 and 13470 yuan / ton, but buyers and sellers were cautious and of a small magnitude, rising water was around 200yuan / ton. after 10:15, the heat of the market fell, and the decline in aluminum futures widened, the spot quotation narrowed to 160mur13440 yuan / ton, and the absolute price was between 13400mur13440 yuan / ton. at this time, the shippers' enthusiasm for shipping increased obviously. The middleman buyer has a more obvious advantage in bargaining, and the actual transaction is more general. Downstream on-demand procurement-based, hesitant to receive goods, fear of heights is obvious, wait and see is still the same. The overall transaction in East China is OK. This morning, the spot rising water was affected by the recovery of liquidity, and the rising water shrank to around 160 yuan / ton.

Summary: yesterday, spot liquidity was released by the release of deliverables and the inflow of imported aluminum ingots was loose, the futures spread narrowed slightly in recent months, and Shanghai Aluminum briefly pulled back. However, the two national sessions will be held this week, and macro expectations are expected to give a boost to non-ferrous metals, and the fundamentals continue to support Shanghai Aluminum. It is expected that Shanghai Aluminum will still be dominated by strong shocks in the short term, so we need to continue to pay attention to the release of macro signals.

(SMM Li Hao 021Mui 51666863)