MI Comment:Aluminium ends September on a high

Friday saw the dollar slump to record lows against the euro, giving the precious complex a rocket with platinum in particular shooting higher. The base complex was more tentative, however, as the month-end and China 抯 Golden Week approached. Being more consumption-sensitive, the industrials were held back partly by China's announcement of new measures to cool its ultra-hot real estate sector. A mixed bag of US and European macro data failed to provide much by way of real direction, though in the end it was nickel that dragged the majority lower, with speculative shorts smashing it down in the closing stag! es. Aluminium fared better than the rest of its LME peers after a couple of days of net stocks draws on the LME and also on the SHFE last week, for the first time in almost two months. After a choppy session between 2525 and 2492 the market finished nearer the upper end, posting its highest close of the month. Forward contangos lengthened fractionally to mid-2009, though the latter half of 9 tipped into 2.00/mth backwardation. Beyond there spreads were also better bid here and there, with 3m-Dec 2011 rated at 45.00b (35.00b) at the close. Activity so far on Monday morning had been quiet, with China effectively closed for the week and no sign yet of any fresh CTA allocations for October. Trading resumed via Select at 2512 and prices picked up to highs of 2527 before the LME reported another net stocks drop, of 1,225t this time. Volumes had scraped to 500 lots currently, last trading at 2520. Cliff Green Consultancy in their latest daily report remained firmly bearish for the coming weeks, they said, though in the near term a further challenge of resistance c. 2530 was on the cards. A decisive breach thereof could extend gains towards the 2580/90 zone, where better supply should be uncovered, they added.