04.08.09

BASE METALS: LME Metals Down With Lower Equities, (Dow Jones)

Posted in Uncategorized at 10:26 am by Administrator

08 Apr 2009 09:40 GMT

BASE METALS: LME Metals Down With Lower Equities,Stronger Dlr (Dow Jones)
By Devon Maylie of Dow Jones Newswires

LONDON (Dow Jones)–Base metals on the London Metal Exchange traded lower
Wednesday due to lower equities markets and a stronger U.S. dollar which
sparked profit taking, traders and analysts said.

More profit taking is possible before the long weekend, said Citi analyst
David Thurtell, when attention will switch to on China’s March import figures
due Monday. These should show another large tonnage after the record for
February and could cause prices to rise and make trading volatile in the coming
days, Thurtell said.

At 0924 GMT LME copper was trading at $4,330 a metric ton, down $49 from
Tuesday’s kerb close. LME aluminum was at $1,462/ton, down $12; LME zinc was at
$1,337/ton, down $18; LME nickel was at $10,725/ton, down $180; LME lead was at
$1,310/ton, down $23; and LME tin was at $10,700/ton, down $200.

Asian and European stock markets fell Wednesday, and aluminum producer Alcoa
began the U.S. first quarter earnings season with a large loss.

Copper canceled warrants in LME warehouses fell 1,025 tons after doubling at
the start of the week, while LME copper inventories rose 2,300 tons on the day.

Copper inventories won’t start coming down in a sustainable way until 2010,
Deloitte’s Chris Thomas said. Furthermore, he said recent buying from China
could be “selective restocking at attractive prices rather than an indication
that we have turned the corner on demand.”

However, other analysts said more stockpile buying is possible and that could
inspire more buying on the LME.

“We think a second round of (China’s) State Reserve Bureau stockpiling will
actually take place in coming months – (of between) 300,000 tons to 600,000
tons – as even today’s prices offer long-term value,” said U.S.-based
consultancy Harbor Intelligence.

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