SMM Aluminum Market Morning Comment (Jan 4)

Overnight, the most-traded SHFE 2402 aluminum contract opened at 19,330 yuan/mt, with low and high at 19,260 yuan/mt and 19,350 yuan/mt before closing at 19,350 yuan/mt, up 10 yuan/mt or 0.05%. LME aluminum opened at $2,326/mt yesterday, with its high and low at $2,337.5/mt and $2,287/mt respectively before closing at $2,306/mt, a decrease of $19.5/mt or 0.84%.

On the macro level, the minutes of the December meeting released by the Federal Reserve indicated that the U.S. interest rate hike cycle may have already ended. Domestic macro environment remained positive, boosting market confidence. In terms of fundamentals, alumina futures prices fell back from highs, thus the cost crisis of aluminum is expected to ease. However, there are still uncertainties on the overseas bauxite market, and the operating rates at major aluminum processing companies needs to be observed. Short-term aluminum prices may fluctuate at the current price level, and we need to pay close attention to the pace of the Federal Reserve's interest rate cuts and the latest changes in raw materials.