Aluminium dropped as investors cautiously awaited key economic data.

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Aluminium dropped as investors cautiously awaited key economic data.

Aluminium prices declined by -1.13%, settling at 196.35, as investors adopted a cautious stance while awaiting key economic data. A private survey revealing an unexpected expansion in Chinese manufacturing activity for November provided a mixed signal, contradicting official data indicating a second consecutive month of contraction. 

Moody's affirmed China's credit rating at A1 but revised the outlook to "negative," citing amplified risks from sustained lower medium-term economic growth and ongoing restructuring in the property sector. The Caixin China General Service PMI for November increased to 51.5, marking the 11th straight month of growth in services activity and the fastest expansion since August. Global primary aluminium output in October rose by 3.9% year-on-year to 6.116 million tonnes, according to data from the International Aluminium Institute. China's primary aluminium imports in January-October increased by 173% y-o-y to 1.17 million tonnes, resulting in net imports of 1.06 million tonnes, up 347.33% y-o-y. In October, imports rose by 221.19% y-o-y and 7.9% month-on-month to 216,600 tonnes, while exports declined by 4.67% y-o-y and 91.29% month-on-month to 600 tonnes. 

From a technical standpoint, the aluminium market is undergoing fresh selling, with a 4.94% increase in open interest to settle at 4654. Prices are down by -2.25 rupees. Aluminium finds support at 195.5, with a potential test of 194.5 below that level. On the upside, resistance is likely around 198.1, and a move above could lead to a test of 199.7.

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