LME copper stocks extend rise above 400 000 tonnes
Copper steady as dollar dips, equities rise
Investors eye US export/import, consumer sentiment data
November 13, 2009
Copper prices were steady above $6 500 (R48 425) on Friday as the dollar pared gains and stronger equity markets boosted sentiment, with investors awaiting more macro data to reassure them on demand prospects.
Benchmark copper for three-months delivery on the London Metal Exchange traded at $6 535 a tonne at 12:36 SA time from a close of $6 503 on Thursday. "The market is not too worried about weak demand because it's hoping with fingers crossed that it will emerge next year," said Calyon analyst Robin Bhar.
"Weakness again for the dollar is helping to support (metals). The bigger picture is still friendly to financial markets in the sense that money is cheap and easy to borrow."
The dollar edged lower on Friday, paring some of the previous day's gains and making dollar-priced metals cheaper for non-US investors.
Equity markets, seen as a proxy for economic growth, advanced in Europe for a third day, boosting sentiment and helping overshadow weak copper inventory data in London.
Latest data showed LME copper stocks rose 1 500 tonnes to 403 625 tonnes, the highest since late April. In Shanghai, warehouse copper stocks hit a new 5-1/2-year high.
"It's more economic optimism and optimism about China ... than real fundamental factors driving the market right now," said Commerzbank analyst Eugen Weinberg.
Supporting sentiment, the month-long strike at Chile's Spence copper mine escalated on Thursday, and a strike in Zambia's Konkola Copper Mines continued.
Chile's Codelco, the world's biggest copper miner, also said it expects the economic rebound in the United States and Europe to help support copper demand next year.
Investors are awaiting consumer sentiment and international trade data from the US later this session for new insight into prospects for demand next year.
NICKEL STOCK SOAR
Nickel, the worst performer in the metal complex, was at $16 150 from $16 190 on Thursday, when it hit $15 975, its lowest since late July.
Stocks of nickel on the LME edged up 18 tonnes to total 131 748 - a level not seen since early 1995, putting a further damper on demand prospects.
But helping limit losses, China's state-backed research group Antaike said on Friday the country's real consumption of nickel may be higher than expected. China is the world's largest metals consumer. "Nickel has been hit by high stocks ... there are some bearish supply side developments," said Calyon's Bhar.
Steel-making ingredient nickel has fallen steadily for more than three weeks, and is down 17 percent in that period.
Among other industrial metals, aluminium, used in transport and packaging, was flat at $1 948 a tonne.
Latest data showed LME stocks fell 2 725 tonnes to total 4.5 million tonnes, extending a recent trend of moves away from record high stockpiles.
But in China, traders and smelter sources said privately held stocks of primary aluminium may have increased more than 40 percent from August to about a million tonnes.
Zinc was at $2 178 a tonne from $2 150, with LME stocks climbing 950 tonnes to total 425 200 tonnes and Shanghai stocks up 7 857 tonnes from a week earlier.
Battery material lead was at $2 274.50 from $2 260, while tin was at $14 800 from $14 650. - Reuters
|
|
