Aluminium prices gained 0.75% to settle at 207, benefiting from China's economic support measures and robust demand. China's industrial profits saw a second consecutive monthly increase in September, signalling a stabilizing economy. Chinese lawmakers approved 1 trillion yuan in bonds for disaster-affected regions, boosting the need for metals in construction. China's domestic aluminium production for September 2023 reached 3.523 million metric tons, up 5.5% year-on-year, with daily production averaging around 117,400 metric tons.
Cumulative production from January to September 2023 stood at 30.822 million metric tons, a 3.13% year-on-year increase. Aluminium billet plants and downstream enterprises reported stable operations, and some plants adjusted alloying ratios upward. Additionally, China expanded its aluminium operating capacity, mainly due to capacity transfer projects in regions like Yunnan and Guizhou. Minor maintenance and capacity changes occurred in other areas, resulting in a total installed capacity of approximately 45.19 million metric tons by the end of September.
From a technical standpoint, short covering took place in the aluminium market, with open interest declining by -1.67% to settle at 3174, while prices increased by 1.55 rupees. Support is anticipated at 205.8, with a potential test of 204.7 if this level is breached. Resistance is likely at 207.6, with a breakthrough possibly leading to prices testing 208.3.
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