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METALS-Aluminium drops to 6-month low on slowdown, China COVID worries

reuters.com · 06/12/2022 22:21
METALS-Aluminium drops to 6-month low on slowdown, China COVID worries

- London aluminium prices dropped to a six-month low on Monday, as worries grew that rising COVID-19 cases in Beijing and prospects of elevated interest rates for a longer time would hammer global economic growth and dent demand for metals.


FUNDAMENTALS

* Three-month aluminium on the London Metal Exchange CMAL3 was down 0.7% at $2,660.50 a tonne, as of 0203 GMT, its lowest since Dec. 16.

* The most-traded July aluminium contract in Shanghai SAFcv1 slipped 1.9% to 20,175 yuan ($2,989.77) a tonne.

* Beijing's most populous district Chaoyang announced three rounds of mass testing to quell a "ferocious" COVID-19 outbreak that emerged at a bar in a nightlife and shopping area last week. nL1N2XZ00Y

* The U.S. dollar =USD jumped to a near one-month high against its rivals, as red-hot U.S. inflation data drove up Treasury yields.

* A stronger dollar makes greenback-denominated metals more expensive for buyers using other currencies.

* Data showed the U.S. consumer price index accelerated to 1% in May from 0.3% in April, suggesting that the Federal Reserve could continue with its 50 basis points interest rate hikes through September to combat inflation. nL1N2XW25Z

* The European Central Bank said on Thursday it would deliver its first rate hike since 2011 next month, followed by a potentially larger move in September. nL1N2XW0AB

* The disparity in costs faced by different copper mining companies in Chile will be taken into account in an industry-wide royalty planned by the government to help finance its ambitious social agenda, the undersecretary of Mining said on Friday. nL6N2XX0AP

* Copper inventories in warehouses monitored by the Shanghai Futures Exchange rose 18.7% from last release on June 02, the exchange said on Friday. nAZN078FHI

* An investigation into the fraudulent use of aluminium stocks to raise finance in China has expanded to three Shanghai-based companies suspected of having pledged aluminium stocks several times over, the state-backed Securities Times reported. nL4N2XX0S5


MARKETS NEWS

* Asian stocks sank on Monday and bond yields ticked higher, as red-hot U.S. inflation re-ignited worries about even more aggressive Federal Reserve policy tightening, and a COVID-19 warning from Beijing added to concerns about global growth. MKTS/GLOB


DATA/EVENTS (GMT)

0600 UK GDP Est 3M/3M

0600 UK GDP Estimate MM, YY

0600 UK Manufacturing Output MM



PRICES
Three month LME copper CMCU3

Most active ShFE copper SCFcv1

Three month LME aluminium CMAL3

Most active ShFE aluminium SAFcv1

Three month LME zinc CMZN3

Most active ShFE zinc SZNcv1

Three month LME lead CMPB3

Most active ShFE lead SPBcv1

Three month LME nickel CMNI3

Most active ShFE nickel SNIcv1

Three month LME tin CMSN3
Most active ShFE tin SSNcv1

($1 = 6.6925 Chinese yuan)


(Reporting by Brijesh Patel in Bengaluru; Editing by Subhranshu Sahu)

((Brijesh.Patel1@thomsonreuters.com; Within U.S. +1 651 848 5832, Outside U.S. +91 8067493865; Reuters Messaging: Brijesh.Patel1.thomsonreuters.com@reuters.net))

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