Profit taking weighs on aluminum prices
JOHANNESBURG — Aluminum fell on Monday as traders booked profits after prices soared to a two-and-a-half-year high on Friday and factory data from top producer China fell short of market expectations.
Benchmark aluminum on the London Metal Exchange ended 0.90% lower at $2,023 a ton, having reached its highest since November 2014 at $2,048 on Friday.
“Today’s move in aluminum is more on profit taking or low volatility in trade than a fundamental shift in sentiment,” said Hamza Khan, head of commodities strategy at ING Bank.
Recent weaker-than-expected economic data from China would not mean a reversal of a positive trend for aluminum, Mr. Khan said, adding: “We still expect capacity cuts from China to remain the main driving factor.”
China’s July factory output grew 6.40% from a year earlier, while fixed- asset investment expanded by 8.30% in the first seven months, both below economists’ forecasts. China’s aluminum output fell 8.20% in July from a record high a month earlier, data showed on Monday, as capacity cuts that have sent prices to multi-year highs start to take their toll on the country’s output.
Among other industrial metals, benchmark copper ended 0.20% down at $ 6,397 a ton, lead ended 0.30% higher at $ 2,335, tin was barely changed at $ 20,300, zinc rose 0.70% to $ 2,917 and nickel ceded 2% to $10,450. —