Copper falls from peak as $ recovers

Print this page Posted on : 11-18-2009 by recycleinme.com

London, Nov. 17

Copper fell on Tuesday as the dollar recovered and investors saw a rise to 13-1/2 month highs in the previous session as overdone given continuing stockpile gains. Benchmark copper on the London Metal Exchange traded at $6,806 a tonne at 1139 GMT, after surging 5.1 per cent to close at $6,855 on Monday, a level not seen since late September 2008.

''Yesterday's jump was a little bit overdone, there are still wider economic concerns. We've seen builds in (copper) stocks since the middle of the year but it's had no impact on price,'' said Mr David Wilson, analyst at Societe Generale.

''The market is picking and choosing what it decides to take notice of, it's entirely sentiment driven,'' he added.

On Monday, the US retail sales data came in better than forecast, re-inforcing the view that the global economic recovery is gathering pace and boosting metals demand prospects.

But current demand for copper remains lacklustre. Latest data showed LME copper stocks jumped 3,550 tonnes to total 410,000 tonnes, their highest since late April.

Among other industrial metals, aluminium bucked the trend in metals to touch a three- month high of $2,050 a tonne from $2,030, despite a surge in stockpiles back towards record levels.

Latest data showed stocks in LME warehouses jumped 23,300 tonnes to total 4.56 million tonnes. Most of the gains were in Detroit - a key car making region - indicating demand from the autos sector is weakening.

Elsewhere, stainless steel-making ingredient nickel, the worst performing metal in recent weeks, was at $16,770 a tonne from $16,800.

Depressing prices, China's state-backed research group Antaike said growth of real nickel consumption was expected to slow to 5.1 per cent next year after a 37.6 per cent surge this year as the stainless steel market digests stocks.

Zinc was at $2,260 a tonne from $2,279, underpinned by news that Australia's Century zinc mine will run out of concentrate at its shipping port later on Tuesday.

Source : Business Line