SHFE 1211 contract opened lower at RMB 15,385/mt on August 1

The most active SHFE 1211 contract opened lower at RMB 15,385/mt on August 1. The three-month contract failed to regain RMB 15,400/mt as contracted July China manufacturing PMI data triggered short selling. It finally closed at RMB 15,385/mt, down RMB 55/mt or 0.36%. Positions were up 1,022 lots to 95,814 lots. Weak manufacturing data raised market expectations for further loose policies. Markets are eyeing upcoming US Federal Reserve interest rate meeting, waiting for more direction. It remains to be seen whether the three-month SHFE aluminum contract will find support or meet resistance at RMB 15,400/mt.

Mainstream traded prices for spot aluminum were at RMB 15,400-15,430/mt in Shanghai on August 1, with discounts at RMB 30-60/mt and low-iron aluminum traded at RMB 15,490-15,510/mt. The worse-than–expected July China manufacturing PMI data dragged down SHFE aluminum to move lower after a low open on Wednesday. Downstream consumption remained weak despite eased liquidity in early month, leaving spot discounts unchanged. Spot traded prices dropped to RMB 15,400/mt and trading at higher prices was even thinner. In the afternoon, SHFE aluminum stagnated. Trading in spot aluminum markets was light due to strong wait-and-see sentiment. Sparse quotations at RMB 15,410-15,420/mt were seen. Inquiries among downstream enterprises and middlemen were rarely heard, leaving overall extremely quiet.