Favourable macro front and solid fundamentals supported aluminum prices to fluctuate upward [SMM Aluminum Morning Comment]

Futures market: The most-traded SHFE aluminum 2411 contract opened at 20,105 yuan/mt overnight, reaching a high of 20,135 yuan/mt and a low of 20,040 yuan/mt, and closed at 20,080 yuan/mt, up 120 yuan/mt or 0.6%. Yesterday, LME aluminum opened at $2,521.5/mt, hit a high of $2,569/mt and a low of $2,506/mt, and closed at $2,540/mt, up $18/mt or 0.71%.

Summary: On the macro front, the US Fed's rate cut was implemented as expected, with the cut slightly exceeding market expectations, causing overseas metals to jump initially and then pull back. Domestically, the market is widely focused on the new round of LPR adjustments, with macro sentiment improving and benefiting the metals market. Fundamentals side, domestic aluminum market supply slightly increased, supported by the September-October peak season, with downstream consumption remaining positive. Aluminum social inventory entered a destocking cycle, showing good performance in the supply-demand balance for aluminum in September and October. Additionally, disruptions in the alumina supply and tight spot supply continued to support alumina prices to fluctuate upward, providing some drive from the cost side for aluminum. Overall, with the short-term favourable macro atmosphere and solid fundamentals, the aluminum market is expected to fluctuate upward in the short term.