Shanghai Metals Market reported that LME aluminum continued to drift higher last Friday buoyed by positive economic data in Europe and the US. LME aluminum briefly dipped to an intraday low of USD 2,057 per tonne after opening at USD 2,060 per tonne but later broke resistance at the 60 day moving average all the way to near USD 2,100 per tonne. Finally, LME aluminum closed USD 28 per tonne or 1.36% higher at USD 2,088 per tonne. Trading volumes were down 1,552 lots to 19,249 lots while positions were up 4,689 lots to 690,125 lots. Latest LME aluminum inventories surged 17,700 tonnes to 5,207,225 tonnes.
China's manufacturing PMI rose to 7 month high in November and the US employment data was in line with forecasts. Meanwhile, great progress has been made over the Greek debt crisis. As such, LME aluminum should continue to edge up and move between USD 2,090 to USD 2,140 per tonne. The SHFE 1301 aluminum contract is expected to open slightly higher at CNY 15,460 per tonnes with prices between CNY 15,410 per tonne to CNY 15,500 per tonne. Spot discounts are expected between CNY 100 per tonne to CNY 150 per tonne due to high inventories and moderate downstream consumption despite eased liquidity at the start of the month.