Overnight, the most-traded SHFE 2406 aluminum contract opened at 20,475 yuan/mt, with high and low at 20,490 yuan/mt and 20,265 yuan/mt before closing at 20,380 yuan/mt, down 5 yuan/mt or 0.02%. LME aluminum opened at $2,570/mt in the previous trading day, with its high and low at $2,620/mt and $2,561.5/mt respectively before closing at $2,610/mt, up $23/mt or 0.89%.

Summary: On the macro level, Federal Reserve officials sent hawkish signals in the latter part of this week, and the hope of a rate cut this year is becoming increasingly slim; domestic favourable policies such as "trade-in" are constantly being promoted, and the consumption remains optimistic during the traditional peak season. However, the situation in Middle East intensified on weekends. UK and the US imposed greater sanctions on Russian aluminum, triggering turbulence in global metals market. Fundamentally, the supply pressure is limited due to Yunnan's electricity supply and the continued closure of the import window. On the demand, high aluminum price suppressed downstream purchasing enthusiasm and operating rate. The spot discounts sustained, but driven by the destocking expectation of aluminum ingots, the discounts may narrow. Overall, aluminum prices were more influenced by growing expectations of macroeconomic recovery and positive fundamentals, and may swing on a strong note. We need to pay attention to the risk of falling back from highs. High prices on downstream procurement and changes in domestic inventory deserved attention.