[Al] SMM Morning Review - 2009/10/12 Aluminum Market

SHANGHAI, Oct. 12 (SMM) -- LME aluminum prices opened at USD 1,908/mt last Friday, with the highest price of USD 1,917/mt. As the US Federal Reserve Board (Fed) Chairman Ben Bernanke said that the Fed would immediately raise interest rates in order to prevent inflation once the economy recovers, but the Fed will continue to maintain a relatively loose monetary policy in the short term. The claim boosted the US dollar index to recover to above 76 points, which resulted in profit-takings in base metals market on Friday night.

    Technically, struggles between long and short positions remained intense when LME aluminum prices were USD 1,900/mt, and LME aluminum prices will remain around USD 1,900/mt today.

    SHFE aluminum prices have shown weak performance last Friday. SHFE aluminum prices moved down straightly after soared, since the wait-and-see sentiment prevailed among market players, and some cargo-holders sold off existing inventories upon weak aluminum prices and large volume of new arrivals during the holiday, resulting in ample market supply and further downward pressure on aluminum prices.

    Today, the wait-and-see sentiment will remain unchanged, and ample market supply will exert great pressure on aluminum prices, so SHFE aluminum prices are expected to fluctuate in the RMB 14,800-15,000/mt range.

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