SMM Morning Comment For Aluminium Market On December 18

SHANGHAI, December 18 (SMM) –
Overnight, the most-traded SHFE 2401 aluminum contract opened at 18860 yuan/mt, with its low and high at 18775 yuan/mt and 18950 yuan/mt before closing at 18915 yuan/mt, up 175 yuan/mt or 0.93%. LME aluminum opened at $2214/mt last Friday, with its high and low at $2269.5/mt and $2193/mt respectively before closing at $2241/mt, up 1.40%.
The Fed held rates at 5.25%-5.50% in December, as expected, lifting market confidence. China's social financing and credit improvements signal support for the real economy. Positive global macroeconomic conditions boost market sentiment. Supply remains stable in China's southwest, but watch for potential aluminium production cuts. On the demand side, the aluminium processing industry has shown a decline in December, but the demand for electricity remains strong, which is unusual for the off-season. Logistics delays and restocking have slashed inventories below 500,000 mt, pressing short sellers out. Near-term prices are likely to be firm and volatile approaching delivery.