Copper steady on China concerns; nickel extends gains * Nickel touches fresh nine-month high * Investors take second look at Chinese growth outlook * Chinese official says 7.5 pct target may be missed Copper was steady and some other base metals slipped on Thursday on investor concern over future demand in top metals consumer China after more details emerged about reform plans. Nickel, however, bucked the trend and extended gains after hitting nine-month highs on Wednesday on worries about Indonesias ore export ban. Most metals rallied on Wednesday after China said it aimed to expand the economy by 7.5 percent, but its finance minister said on Thursday that it was all right to miss that target slightly as long as enough jobs were created. Investors also focused on other details from Chinas parliament meeting, including news on Wednesday that the worlds second largest economy would reduce its pace of investment to the lowest in 10 years as it pursues more sustainable expansion. It (Wednesdays rally) was a bit of an overshoot, because theres a lot of uncertainties and unknowns in that 7.5 percent and if you look at the reform plans theyre not skewed to fixed asset investment, said Grant Sporre, head of metals research at Deutsche Bank in London. Today weve got people picking through the details and saying Well the headline GDP might be good, but its not going to be necessarily that bullish for base metals demand. Three month copper on the London Metal Exchange was virtually unchanged in official midday trading, edging up 0.06 percent to $7,034 a tonne. The most-traded May copper contract on the Shanghai Futures Exchange inched 0.3 percent lower to close at 49,140 yuan ($8,000) a tonne. Zinc fell 0.7 percent in official rings to $2,101 a tonne, coming off a one-year peak touched on Wednesday after LME stocks increased by 8,150 tonnes on Thursday . Sentiment was also dampened by continued tensions in Ukraine after Russia rebuffed Western diplomatic efforts to persuade it to pull forces in Crimea back to their bases. Investors were also focused on Fridays U.S. jobs report, with growth likely picking up enough in February to encourage the Federal Reserve to continue to scale back its monetary stimulus, although the gain is likely to be tepid given the unrelentingly harsh winter weather. NICKEL BUCKS TREND Nickel, however, bucked the weaker trend and climbed to a new nine-month high of $15,487 a tonne. It was untraded in official rings, where it was bid at $15,480, up 1.37 percent. Theres certainly a recent disconnect between nickel and the other four base metals recently, clearly as a function of the Indonesian ore dynamic, Societe Generale base metals analyst Mark Keenan said. Nickel has been the top performing base metal so far this year, surging over 10 percent while copper has shed 5 percent and lead dropped over 4 percent. In Indonesia, around $500 million a month in ore and concentrate exports have stopped since President Susilo Bambang Yudhoyono in January imposed mining rules including a ban on nickel ore exports. The country was previously the worlds top exporter of the metal used in the production of stainless steel. The market is starting to realise that the longer this (ban) drags on the tighter the nickel market is going to get towards the end of the year and into 2015, Sporre said. In other metals, aluminium was unchanged in official trading at $1,775 a tonne and lead shed 0.26 percent to $2,131 while tin failed to trade in official rings and was bid unchanged at $23,250 a tonne.
Posted on: Thu, 06 Mar 2014 13:21:16 +0000