02 FEBRUARY 2016Shanghai Metal Market
About 51% of Chinese aluminium smelters bearish toward prices this week, SMM survey
Edited by : AL CIRCLE
1 min read
About 51% of the 35 Chinese aluminium smelters surveyed by SMM see aluminium prices fall this week.
These pessimists expect SHFE 1604 aluminium to fall below RMB 10,600/mt and LME aluminium to fall below USD 1,500/mt. First, spot discounts in domestic spot market have expanded, due to cooling downstream consumption as the holiday nears and stocks in trading markets are beginning to rise. Second, China’s manufacturing PMI remained negative in January. Third, short selling pressure remains strong at highs. Fourth, the US dollar index remains high.
Another 35% see SHFE 1604 aluminium hovering around RMB 10,600/mt. Investors will be cautious about entering out of risk aversion ahead of the 2016 Chinese New Year holiday in early February.
The rest 14% are bullish that LME aluminium will rise to USD 1,520-1,540/mt and SHFE 1604 aluminium will climb above RMB 10,700/mt. Aluminium stocks in China’s major trading markets will grow slower during this year’s Chinese New Year holiday than in the same period last year. This will give some investors reason to open long positions before the holiday.
These pessimists expect SHFE 1604 aluminium to fall below RMB 10,600/mt and LME aluminium to fall below USD 1,500/mt. First, spot discounts in domestic spot market have expanded, due to cooling downstream consumption as the holiday nears and stocks in trading markets are beginning to rise. Second, China’s manufacturing PMI remained negative in January. Third, short selling pressure remains strong at highs. Fourth, the US dollar index remains high.
Another 35% see SHFE 1604 aluminium hovering around RMB 10,600/mt. Investors will be cautious about entering out of risk aversion ahead of the 2016 Chinese New Year holiday in early February.
The rest 14% are bullish that LME aluminium will rise to USD 1,520-1,540/mt and SHFE 1604 aluminium will climb above RMB 10,700/mt. Aluminium stocks in China’s major trading markets will grow slower during this year’s Chinese New Year holiday than in the same period last year. This will give some investors reason to open long positions before the holiday.
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