Analysis of aluminum price trend in Yangtze River spot market (5.8-5.12)

Macro: Recently, the inflation data released by the United States, whether it is its April import price index annual rate or PPI annual rate, has recorded a sharp recovery beyond expectations, indicating that the US inflation outlook is good, while the US retail sales monthly rate has fallen for three consecutive months, the market expects April data or a sharp upward revision, if in line with expectations, good economic data will continue to increase the probability of the Fed to raise interest rates in June, interest rate hike expectations are getting stronger and stronger, aluminum prices are under pressure and volatile
.
Domestically, dragged down by the decline of Lunaluminum, Shanghai aluminum fell at the beginning of the week, and then stopped falling and stabilized
.
Although Shandong's policy to reduce production capacity has not yet made substantial progress, but traders strong selling prices make aluminum prices firm, aluminum prices into a dilemma pattern, is expected to fluctuate unchanged next week, or rise slightly, but the upside is limited
.

Market: At the beginning of this week, aluminum prices fell sharply, downstream wait-and-see sentiment is strong, holders also ship poorly, the overall trading situation is general, Tuesday with the stabilization of aluminum prices, transaction slightly improved, Chinese merchants inquiry positive, bargain hunting willingness is strong, Wednesday aluminum volatility slows down, holders continue to maintain premium price shipments, morning downstream bargaining continues to receive goods, demand is stable, trading remains active, Thursday downstream near the weekend did not show stock demand, are mainly on-demand procurement, market trading conditions are general, holders in aluminum prices after the plunge to sell , keep a small amount of premium at a high price shipment
.
On the last trading day of the week, aluminum prices regained their upward trend, downstream weekend replenishment demand increased, and holders shipped goods at high prices, and the transaction was good
.

In terms of inventory: Lun aluminum inventory continued to decline, the latest inventory reported 1556150 metric tons, a total of 43,575 metric tons of inventory was reduced this week, a decrease of about 2.
7%; The total aluminum stock on the Shanghai Futures Exchange this week was 410405 tons, an increase of 6,500 tons, or about 1.
6%,
from last week.
From the perspective of inventory, the inventory data of the five places released last Thursday showed that it decreased by 31,000 tons from last Thursday to 1.
195 million tons, and the inventory of consumer places began to fall
.
Considering that the current price of alumina has fallen to near the cost line of many enterprises, alumina companies have reduced production, and the price of alumina may stabilize in the future, and the cost will give strong support
to aluminum prices.
The domestic central bank launched MLF operations, the future capital may tend to ease, the overall market may improve, Shanghai aluminum or usher in a certain chance
of rebound.

In the future: China's recent weak manufacturing and trade data have caused investor concerns, clouding the outlook for industrial metal demand, while the de-capacity policy has not made substantial progress, the outlook for aluminum prices is uncertain, and aluminum prices remain weak and volatile
this week.
However, considering that the expectation of policy production cuts still exists, there is still a game in the current market, and any substantial policy production cuts in the future will still be the driving force for the rise in aluminum prices, and aluminum prices may continue to maintain a low shock trend under fundamental pressure in the short term, but there is limited
room for continued decline.
It is expected that the core operating range of the main contract of Shanghai aluminum next week will be 13700-14300 yuan
.