LME Aluminium reversed its downward trend as two major macroeconomic factors- the US dollar index and oil prices gave support. The US dollar index dropped to 100 from highs after Italian vote and oil soared more than 10 per cent on Wednesday to over $50 a barrel- its highest in a month, helping LME aluminium prices rise. The contract which traded at around US$1,715/mt on Friday, last week, rose higher by 0.75 per cent to close at US$1,728/mt on Monday, November 5.
Shanghai Metals Market says, LME aluminium should strengthen further and move at US$1,715-1,740/mt on Tuesday.
As on November 5, LME official stock of aluminium stood at 2139275mt, Total Live Warrants was recorded at 1384875mt Cancelled Warrant was at 744325mt. .jpg)
In China, aluminium traded on Shanghai Metal Exchange opened at US$2,002/mt on Tuesday, down 0.39 per cent from yesterday's opening price of US$2,002/mt.
Aluminium on Shanghai Futures Exchange- SHFE 1702 aluminium outperformed other base metals recently. According to SMM study, the contract will likely find support at the 40-day moving average but will be refrained by weak fundamentals. So, SHFE 1702 aluminium is predicted to range between RMB 13,200-13,400/mt on Tuesday.
Spot aluminium price in China's domestic market should trade at discounts of RMB 20/mt to premiums of RMB 20/mt, says SMM.
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SHFE aluminium is expected to firm up under the effect of a weak dollar on Tuesday, SMM foresees.
“US reported a slew of positive economic data, but the dollar remains weak, and this is expected to support base metal prices,” SMM says.
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