Aluminium On MCX Settled Down -0.08%

Aluminium on MCX settled down -0.08% at 125.25 as the ongoing turmoil over Donald Trump has increased investors’ worries over political stability in the U.S. In addition, investors worry that under these political turbulences, the Trump administration will struggle to implement pro-growth initiatives. Aluminium prices are expeted to see firmness as heavy palls of industrial smog have almost become the norm in some Chinese cities.

Small wonder that environmental sustainability is rapidly moving up the agenda for Xi Jinping, the president, as he flexes his political muscles and consolidates his leadership of China. The country’s moves to protect the environment and avoid pollution-related social unrest represent a radical shift in Chinese policy. Just eight years ago, China viewed climate change initiatives as a western conspiracy to limit China’s rapid growth.

Chinese producers and local authorities are caught between pressure to keep plants open in order to avoid social unrest and demonstrations by environmental protesters at some of the plants. The latest clampdown, details of which emerged in mid-April, may reduce aluminium capacity by as much as 5m tonnes, or 11 per cent of existing capacity. Sentiments still remain firm as daily average primary aluminium output excluding China fell to 70,300 tonnes in April, from 70,500 tonnes in March, data from the IAI showed on Monday.

Global production for April, excluding China, was 2.11mtns, down from 2.185mtns recorded in March. In China, daily average output rose to 92,200 tonnes in April against 87,300 tonnes in the March. Total Chinese production in April was 2.766 million tonnes from 2.707 million tonnes in March, the IAI said. Now technically market is getting support at 124.9 and below same could see a test of 124.5 level, And resistance is now likely to be seen at 125.6, a move above could see prices testing 125.9.

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Suhani Verma

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