Overnight, the most-traded SHFE aluminum 2412 contract opened at 20,775 yuan/mt, reaching a high of 20,870 yuan/mt and a low of 20,705 yuan/mt, and closed at 20,725 yuan/mt, down 10 yuan/mt or 0.05% from the previous close. Trading volume was 65,100 lots, open interest was 195,000 lots, with a daily decrease of 3,112 lots. Yesterday, LME aluminum opened at $2,612/mt, hit a high of $2,650/mt, a low of $2,606.5/mt, and closed at $2,626/mt, up $11/mt or 0.42%.
Summary: On the macro front, US ADP employment data far exceeded expectations, enhancing the soft landing outlook, and the US dollar index strengthened. Additionally, the market is trading on the expectation of Trump's election, with the market widely awaiting the results of the US election on November 5, and global monetary policy is turning accommodative. In the domestic market, monetary policy is aligned with RRR cuts and interest rate cuts, releasing liquidity. The market is focused on the policy direction of the 14th National People's Congress Standing Committee meeting on November 4. On the fundamentals, the domestic aluminum supply side remains largely stable. Aluminum ingot arrivals are insufficient due to decreased railway transport efficiency in Xinjiang, maintaining a destocking state in the market. Spot alumina supply is tight, and some companies' production cuts and suspensions are causing disruptions, keeping alumina prices fluctuating upward. Domestic aluminum profitability has significantly narrowed, with high costs providing strong support for aluminum prices. On the demand side, downstream aluminum operating rates are intermittently weakening due to environmental protection issues. Research on companies' orders on hand indicates a potential further decline in downstream aluminum operating rates. In summary, the domestic aluminum supply side growth slows, and the fundamentals of low inventory and high costs persist, with short-term aluminum expected to fluctuate upward.
