Aluminium settled down -0.65% at 121.45 dragged down by worse-than-expected US economic data, second default by Chinese SME, as well as Argentina sovereign default. Caution grew in the market Thursday on downbeat US data and stronger US dollar. The US ISM manufacturing index fell from June’s 62.6 to 52.6 in July, well below forecast. Meanwhile, the latest initial jobless claims rose by 23,000, but the average in the past four weeks sank to an 8-year low of 297,250. The economic figures disappointed investors. Besides, market players were unwilling to act before release of China’s official manufacturing PMI and US July nonfarm payrolls. That, combined with concerns over potential butterfly effect of the Argentina default, pushed US stocks down nearly 2%, exerting a drag on base metal markets. Eurozone unemployment rate fell in June to 11.5%, a low not seen since September 2012, while the unemployment rate in 28 European Union member states also dipped to 10.2%, hitting a refreshed low since March 2012. The flash Eurozone CPI dropped further to 0.4% in July, its lowest level since 2009. US initial jobless claims for the week ending July 25 came in at 302,000, higher than the expected 300,000. Chicago’s manufacturing PMI was reported at only 52.6, well below the estimated 63. US July nonfarm payrolls report due for release late on Friday, however, is expected to be negative.  Technically market is under fresh selling as market has witnessed gain in open interest by 26.21% to settled at 7599 while prices down -0.8 rupee, now Aluminium is getting support at 120.6 and below same could see a test of 119.8 level, And resistance is now likely to be seen at 122.8, a move above could see prices testing 124.2.

Trading Ideas:

Aluminium trading range for the day is 119.8-124.2.

Aluminium ended with losses dragged down by worse-than-expected US economic data.

US initial jobless claims for the week ending July 25 came in at 302,000, higher than the expected 300,000.

Aluminium daily stocks at Shanghai exchange came down by 602 tonnes.