Zinc has been the least favourite metal on the London Metal Exchange for the past 12 months, but that should change on the back of project delays and the worst project finance conditions "in living history" for new mines, said Mr Chris Fraser, Citigroup Inc's Head of Metals, Mining and Materials in Australia.
|
|
|
Healthy volumes of trade and a steady flow of fund and merchant buying are pushing copper prices steadily higher, and traders said this will likely fuel some panic short-covering when the U.S. opens.
London Metal Exchange copper is at four month highs above $8,000 a tonne, and has set its sights on a move above $8,300/tonne, traders noted.
As of 1050 GMT, LME copper traded at $8,055/tonne, up 3.9 per cent from Monday's low.
Steady declines in copper stocks have been underpinning the return of bullish sentiment towards the metal, with stocks down by another 4,025 tonnes Tuesday to 140,350 tonnes. Several analysts are now predicting stocks in LME-approved warehouses will drop to 100,000 tonnes, propelling copper prices to fresh all-time highs.
But other market participants remain skeptical over the pace of the stock drawdowns, especially during the Chinese new year holiday, when demand is traditionally slow. Several traders said funds have been drawing down inventory and financing its storage, giving the market the appearance of being tighter than it actually is.
However, supply side factors continue to support prices and are likely to remain in the background in the longer term. Lead gains
LME lead traded up 3.3 per cent from Monday's low at near all-time highs of $3,090/tonne, while aluminium was up 1 per cent at seven-month highs of $2,840/tonne.
Activity in the other base metals was more subdued, but traders said the US market is still holding relatively large short positions, which could trigger some buying interest later Tuesday.
|
|
|
|
Source : Business Line |
|
|
|
|
|
RecycleINme.com. All Rights Reserved
