Aluminium experienced an increase of 0.81%, concluding at Rs 368.9. This rise was underpinned by strong manufacturing activity in China and ongoing supply-side issues associated with geopolitical tensions in the Middle East. Robust Chinese macroeconomic indicators, highlighted by a manufacturing PMI increase to 52.2 in April—marking its most rapid expansion since December 2020—bolstered confidence in industrial demand, especially as new orders and output growth experienced significant acceleration.

Concerns on the supply side persist at heightened levels, primarily due to ongoing disruptions in the Middle East, particularly regarding the sustained restrictions surrounding the Strait of Hormuz. While Emirates Global Aluminium’s Jebel Ali smelter has returned to operations that are more aligned with normalcy, the wider region remains enveloped in uncertainty. Market participants are progressively incorporating tighter supply into their pricing models, as financial institutions adjust their forecasts upward. Bank of America has raised its price outlook to $4,000 per ton for the fourth quarter of 2026.

Meanwhile, JP Morgan anticipates a notable global deficit of 1.9 million tons, attributed to supply disruptions, suggesting that prices may approach the $4,000 mark in the near term. Indicators from the physical market likewise demonstrate a trend towards tightening conditions. Japanese port inventories experienced a decline of 7.4%, reaching 279,800 tonnes. Concurrently, premiums escalated to an 11-year peak of $350–$353 per ton for Q2 shipments, underscoring the tight supply situation. In March, China experienced a 6.9% year-on-year increase in aluminium imports, driven by supply concerns, despite a 2.7% rise in domestic production.

In March, global primary aluminium production experienced a year-on-year increase of 0.9%, although it showed a slight decline on a daily basis relative to February, suggesting a minor moderation in output levels. From a technical perspective, the market is experiencing short covering, as evidenced by a slight decrease in open interest of 0.03% to 3,097 contracts, accompanied by a price increase of Rs 2.95. Immediate support is identified at Rs 367.2, with subsequent support at Rs 365.6. Resistance is established at Rs 370.1, and a sustained movement above this threshold may propel prices toward Rs 371.4.