LONDON: Aluminium fell to its lowest in week on Friday and was poised to end the week lower as the market corrected following a recent price surge over US sanctions on a major shareholder the world's largest producer.
Benchmark aluminium on the London Metal Exchange (LME) fell 2.8 percent to $2,269 per tonne by 1130 GMT, its lowest since May 3. The price in the light metal rallied to a nine-year high last month.
Washington last month announced sanctions on Russian billionaire Oleg Deripaska and several companies in which he is a large shareholder, including Rusal.
"It's a continued correction from the multi-month high we have seen in April," Commerzbank analyst Daniel Briesemann said, adding that the aluminium price reaction to US sanctions had been exaggerated.
"The news will dictate the price. However over the next few weeks or month I would definitely say the correction would continue."
RUSAL: Russian aluminium giant Rusal on Friday warned of expected harm to its business from US sanctions, sending its shares down more than 7 percent despite the company reporting a 20 percent jump in first-quarter core profit.
STOCKS: On-warrant stocks in aluminium, those not earmarked for delivery, fell 3,250 tonnes to 860,700 tonnes. They have shed 18 percent since April 16 to the lowest levels since early February while headline stocks are down 11 percent.
CHINA LENDING: Chinese banks extended 1.18 trillion yuan ($186.4 billion) in net new yuan loans in April, up slightly from March and higher than expectations, as policymakers look to support the economy as it faces fresh risks from US trade threats.
Signs of more lending in China, the world's top consumer of metals, should generally support prices.
EGA: Emirates Global Aluminium's stock market listing is likely to slip to 2019 because of turmoil in global aluminium markets after the United States imposed sanctions on Rusal, three sources familiar with the deal said.
JAPAN SUPPLY: Japanese copper miners JX Nippon Mining & Metals and Sumitomo Metal Mining plan to increase output from their mines in Chile this year, but are facing challenges in bringing them to full capacity and meeting profit targets.
PRICES: Copper was flat at $6,921.50 per tonne but was on track to end the week more than a percent higher. Lead added 1.5 percent to $2,340, tin slipped 0.5 percent to $20,720, zinc added 0.2 percent to $3,093.50, while nickel rose 0.3 percent to $13,920.
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