Lead hits fresh high, other metals in holiday mood

LONDON - Lead touched a new high on Monday and copper was steady on the London Metal Exchange with the markets subdued due to holidays in China and the United States, traders said.

By (Reuters)

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Published: Mon 19 Feb 2007, 5:13 PM

Last updated: Sat 4 Apr 2015, 9:55 PM

‘The Chinese are out and it is the Presidents Day in the (United) States. Copper and aluminium have hardly traded -- that is going to be the flavour of the day,’ an LME trader said.

Lead MPB3 hit $1,810 a tonne for the first time ever following technical buying and market speculation that Xstrata XTA.L was looking for material for its customers.

The firm declared force majeure on lead deliveries from its Northfleet refinery near London two weeks ago after problems at its Mount Isa smelter in Australia.

By 1033 GMT lead was quoted at $1,800/1,820 a tonne versus its last quote on Friday at $1,785/1,790.

Three-months copper MCU3 was indicated at $5,800/5,820 after settling at $5,810 at Friday’s close.

Dealers said the Chinese Lunar New Year holiday breaks would leave markets subdued across much of Asia, while the US Presidents Day holiday would dampen interest in North America.

‘We expect market conditions to remain relatively subdued until the Chinese return from the 1-2 week break,’ a Deutsche Bank report said.

Ahead of third Wednesday when the contracts expire ‘we shall see a high degree of market noise and position house keeping meaning much of the price fluctuations can be discounted,’ a Standard Bank report said.

The investment bank said it would wait for the start of March to gain a truer picture of future market direction.

US, Asian holidays

A Standard Chartered report said copper prices at $5,600 a tonne could prove a solid base ‘from which copper mounts a concerted attack at the $6,000 overhead resistance level.’

Supply-side fundamentals were mixed. LME inventories fell by 2,725 tonnes to 211,075. But Shanghai copper warehouse stocks rose 4,355 tonnes last week to 31,007 due to rising supply into China from imports and reduced demand from domestic end users around the Chinese New Year period.

Copper rose some 7 percent during the past week after positive comments from Federal Reserve Chairman Ben Bernanke and indications of stronger Chinese demand following bullish import data in the month of January [ID:nPEK67998].

‘We will maintain a keen eye on the start of March and look for signs of further Chinese buying,’ Standard Bank said.

Standard Chartered said they were looking at a global annual increase in demand close to 4.5 percent year-on-year with an average price forecast at around $6,100 for the second quarter.

The union at Southern Copper Corp.’s PCU.N SPC.LM Ilo smelter, producing 1.2 million tonnes of concentrate a year, said on Friday it would put off strike plans while awaiting a government resolution due within a week.[ID:nN16295189]

Aluminium capped

Aluminium MAL3 was at $2,785/2,790 against $2,793. Prices were under pressure after bauxite production in Guinea, the world’s largest exporter, resumed. [ID:nL17882599]

Nickel MNI3 was at $38,900/39,100 versus $38,900/39,000. Stocks in LME warehouses came in higher at 4,434 tonnes, of which 2,178 are available to the market.

Tin MSN3 was at $13,050/13,250 against $13,140/13,145. On Friday it hit a new all-time high at $13,300.

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