Aluminium edges up, supported by manufacturing strength

SINGAPORE: Aluminium edged up on Thursday, supported by signs of strength in the manufacturing sector. Benchmark three-month aluminium on the London Metal Exchange was up 0.59% at $3,094 a metric ton by 0300 GMT.

The most-traded aluminium contract on the Shanghai Futures Exchange added 0.09% to 22,505 yuan ($3,316.83) a ton.

Prices for the light metal, used in transport, packaging and construction, were supported by evidence of manufacturing resilience.

Data released by China, Europe, and the US on Wednesday showed manufacturing strength despite higher input prices.

Aluminium prices have plunged in the last two weeks as the ongoing US Iran peace process reduced the risk premium on the metal from the war. Elsewhere, copper was subdued.

A June deadline for a recommendation on potential US tariffs on refined copper came and went with no news from the White House.

Tariff concerns have been a key driver for copper in recent months.

On the LME, copper was largely stable, increasing only 0.02%, while on the SHFE it dipped 0.09%.

The market was supported by balanced comments on inflation from US Federal Reserve Chair Kevin Warsh boosting base metal markets, which fear that stubborn inflation could lead to higher-for-longer interest rates.

Higher interest rates weigh on growth dependent industrial minerals by suppressing economic activity. Copper has been boosted by demand growth projections from AI infrastructure, grid investment and electric vehicles.

Among other LME metals, zinc was little changed, up only 0.04%, lead added 0.19%, nickel dipped 0.15% and tin lost 0.49%. Elsewhere on SHFE, zinc lost 0.71%, lead lost 0.63%, nickel lost 0.47% and tin added 0.34%.