Aluminum surges on strong US durable goods orders

Strong growth in US durable goods orders helped push aluminum prices to an 18-month high on Tuesday.

The metal increased US$26.50 from Friday to close at US$2,082/t in London, its highest point since February 2013.

The rise came as US Census Bureau data showed new orders for manufactured durable goods in July increased US$55.3bn or 22.6% to US$300bn, its highest level since 1992. The increase to US$133bn was driven by a 74.2% hike in transportation equipment orders.

Aluminum's surge was also driven by the triggering of stops in fairly thin conditions after London markets were closed for Monday's UK bank holiday, while the higher prices also sparked some selling interest, Standard Bank said in a note.

Prices of the metal have increased in recent weeks on the back of strong demand and production constraints outside of China, but the price increases could spur higher output and halt the metal's rally, INTL FC Stone analyst Edward Meir said in July.

Copper prices increased to US$3.219/lb from Friday's US$3.215/lb, with lead and zinc dipping by US$2.50 and US$4.50 to US$2,257/t and US$2,359.50/t, respectively. Nickel rose US$180 to US$18,805/t, with tin down US$335 to US$22,090/t and molybdenum up US$350 to US$29,350/t.

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