Aluminium hits 4-week peak as China trade data brightens demand outlook

Non-ferrous metals including aluminium, zinc, and copper gained on Wednesday, April 13, after Chinese trade data brightened the outlook for demand in the world's biggest metals consumer, prompting some investors to shift back to commodities.

Price gains in aluminium and industrial metals had a snowball effect as they pushed through key levels, sparking more buying by speculators based on technical signals, traders said.

The initial catalyst was data showing that China's exports in March returned to growth for the first time in nine months, adding to further signs of stabilisation in the world's second-largest economy that cheered regional investors.

"The trade numbers are very, very strong. On the ground, the fundamentals appear to be consolidating. On the demand side, the property market has certainly been very supportive," said Xiao Fu, head of commodity market strategy at Bank of China International in London.

"Yields in other asset classes are less attractive so some funds are seeking other places and commodities have been considered relatively cheap."

Aluminium climbed 1.6 per cent to end at $1,559 a tonne, the highest since March 14. Aluminium is the top-performing LME metal so far this year, up around 3 percent.

It was also supported by news that 116,050 tonnes more of inventories MALSTX-TOTAL were due to leave LME-approved warehouses after a steady stream of withdrawal notices in recent weeks.

Declining stocks are often a signal of better demand, although analysts say aluminium is often merely shifted to other warehouses as part of financial deals.