[minutes of SMM Aluminum Internal Morning meeting] weak data from Europe and the United States, fundamental costs continue to fall

7.25 minutes of SMM internal aluminum morning meeting

Market surface: overnight Shanghai aluminum night trading performance before suppression, night trading closed at 13780 yuan / ton, down 15 yuan / ton from the opening of the day. London Aluminum opened at $1814 a tonne yesterday, closing at $1824.5 a tonne, up $3.50, or 0.19 per cent, dominated by bulls.

Macro: data, yesterday, Europe and the United States released data are weak, the United States in July Markit manufacturing PMI hit a new low since September 2009, the initial value of 50, the previous value of 50.6, expected 51; the total number of new home sales in the United States in June (10,000 households) public value of 64.4, the previous value of 62.6, expected 66; German manufacturing PMI hit a 7-year low in July; Manufacturing PMI in the euro zone in July was the lowest since December 2012, 46.4, after a 47.6, expected 47.6. The Baltic dry bulk index fell the most in nearly six months, falling 7 per cent to 2014 points.

Fundamentals: the cost continues to take the downward path, yesterday SMM alumina area weighted quotation down 10 yuan / ton. On the demand side, (1) Norway Hydro cut its forecast for aluminum demand growth in 2019 for the second time, believing that aluminum demand will grow by 1-2% this year, down from 1-3% expected in April this year. (2) Ukraine launched an anti-dumping investigation into China's aluminum wheels, involving a product tax number of 8708705090.

Spot: the spot price between Wuxi and Shanghai is between 13770 yuan / ton and 13790 yuan / ton, which is about 10 yuan / ton, which is 10 yuan / ton lower than that of the previous day, and the price in Hangzhou is between 13800 yuan and 13810 yuan / ton. In the morning, the spot price between Shanghai and Wuxi was around 13770 yuan / ton, and the spot price began to focus on 1378 to 13790 yuan / ton after 10: 30. As the aluminum price fell for three days in a row, the shipping willingness of the shippers weakened, while the middlemen were active in replenishing goods at low prices, with more recipients than shippers, and the overall trading between traders was active. After 11: 00, the center of gravity of aluminium futures continued to rise, but at this time the trading activity was scattered, and the actual market quotation did not rise significantly. Downstream because of the first two days of partial stock, Wednesday on demand goods mainly, and did not purchase in large quantities. East China yesterday the overall transaction is better.

Summary: the current aluminum consumption into the off-season, the cost end is still in the downward stage, short-term fundamentals under pressure, but based on the September peak season to accelerate the warehouse expectations, electrolytic aluminum industry should give profits, industrial chain profits from the cost of alumina to give up, suggested price if the correction can be in 13500 to 13800 yuan / ton position waiting for more than a single layout, structural attention to 0912 contract to buy near and far, the lack of strong logic support, do not recommend new opening.

(SMM Li Hao 021 5166 6863)