SHANGHAI, Apr. 16 (SMM) –On Tuesday night, SHFE 1506 aluminum contract dropped to RMB 13,025/mt after starting at RMB 13,040/mt. But prices rallied to RMB 13,105/mt later on rising LME aluminum and technical correction before ending the night session at RMB 13,075/mt. Trading volumes totaled 8,738 lots, with positions up 928 to 120,000.
China’s GDP growth slowed to 7% in Q1, raising hopes for RRR cuts in Q2 to boost flagging economy. Strong risk aversion sentiment before the release of Q1 GDP sent the most active contract down to RMB 13,005/mt. But the light metal bounced back to RMB 13,090/mt later due to robust gains in SHFE zinc and lead, and ended Wednesday at RMB 13,060/mt. Trading volumes totaled 27,882 lots, with positions up 2,602 to 121,674.
Spot aluminum largely traded between RMB 12,950-12,960/mt in Shanghai on Wednesday, discounts of RMB 70-80/mt over SHFE 1504 aluminum contract, versus RMB 12,940-12,960/mt in Wuxi, and RMB 13,000-13,010/mt in Hangzhou. Sellers rushed to sell out of fear that spot discounts might widen after SHFE 1505 aluminum contract shifts to the new front-month contract tomorrow. Traders entered the market as SHFE aluminum stopped falling, but downstream producers remained cautious. In the afternoon, sellers held back after SHFE aluminum rose, leaving trading muted.
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