LME aluminium opened the week higher on weak dollar; SHFE remains strong on higher premium

The US dollar eased on Monday as growing hopes for a US-China trade deal improved risk sentiment and sapped demand for the safe-haven greenback. The dollar index fell 0.07% and ended at 97.74. LME base metals mostly increased with the SHFE complex trading mixed. LME aluminium rose 0.14% and SHFE aluminium increased 0.14%.

LME aluminium opened the week higher on Monday. Three-month LME aluminium gained for the second straight session with a high of US$1740 per tonne, ending up 0.14% at US$1,736 per tonne on Monday night as longs added their position. Three months aluminium is likely to trade within US$1,720-1,750 per tonne today.

As on October 28, Monday, LME aluminium cash (bid) price stood at US$ 1726 per tonne, LME official settlement price stands at US$ 1727 per tonne; 3-months bid price stands at US$ 1731.50 per tonne, 3-months offer price is US$ 1732 per tonne; Dec 20 bid price stands at US$ 1810 per tonne, and Dec 20 offer price stands at US$ 1815 per tonne.

The LME aluminium opening stock dropped to 963825 tonnes. Live Warrants totalled at 788775 tonnes, and Cancelled Warrants were 175050 tonnes.

LME aluminium 3-months Asian Reference Price is hovering at US$ 1734 per tonne.

SHFE Aluminium Price Trend

Benchmark aluminium price for SHFE (Shanghai Future Exchange) remains unchanged at US$ 2002 per tonne today, 29 October 2019.

The most traded SHFE 1912 contract held in a wide range around RMB 13,825 per tonne during the daytime session, where it finished the trading day marginally higher ysterday. It remained under pressure from the 20-day moving average, but held above RMB 13,810 per tonne. The December contract failed to recover after loaded-up shorts sent it to a low of RMB 13,765 per tonne, closing 0.25% lower on the day at RMB 13,790 per tonne overnight. Trading range today is seen at RMB 13,750-13,850 per tonne. 

Currently firm spot premiums will subdue bearish sentiment, deterring SHFE aluminium from rapidly falling on expectations of weaker consumption.