Aluminium settled down -1.29% at 122.90 after China's August CPI and PPI fell short of market expectations, triggering investor concerns over demand for industrial products. When combined with escalating geopolitical turmoil, base metals prices were dragged down. China’s PPI slipped 1.2% YoY in August, marking 30 consecutive months of decline and sparking concerns over demand in the world’s top metals consumer. Initial jobless claims in the US rose to 315,000 last week. Geopolitical tensions worsened. China’s CPI rose 2.0% YoY in August, shy of market expectations for 2.2% and down from 2.3% in July, and its PPI fell 1.2% YoY, down for a 30th month in a row. These soft economic data, however, failed to raise expectations for stimulus policies due in large part to the Chinese Premier’s comments that the government will no longer rely on creating money to boost economic growth. The US Labor Department reported on Thursday that initial jobless claims for the week ending September 6 increased 11,000 to 315,000, a high last seen in the week ending June 28 and beating the estimated 300,000. Despite the downbeat jobs conditions, the US dollar index still rebounded after testing support at the 5-day moving average. The European Union (EU) announced new sanctions on Russia oil and national defense sectors on Thursday, but could lift them if Moscow abides by a ceasefire agreement. Technically market is under long liquidation as market has witnessed drop in open interest by -8.78% to settled at 4935 while prices down -1.6 rupee, now Aluminium is getting support at 122 and below same could see a test of 121.2 level, And resistance is now likely to be seen at 124.1, a move above could see prices testing 125.4.

Trading Ideas:

Aluminium trading range for the day is 121.2-125.4.

Aluminium prices dropped as pressure seen due to disappointing economic indicators from China and US as well as escalating geopolitical tensions

China’s PPI slipped 1.2% YoY in August, marking 30 consecutive months of decline and sparking concerns over demand in the world’s top metals consumer.

Aluminium daily stocks at Shanghai exchange came down by 4828 tonnes.