Market and product
Base metals prices hold steady in quiet conditions
Support to prices came from strong fundamentals and concerns that possible trade sanctions against Russia could impact supply of metal – in particular aluminium, zinc and nickel.
“Inventories for zinc and aluminium have fallen the most out of all the base metals this year, down 30 percent and 10 percent respectively. LME data also suggests that investors continue to build long positions with the spectre of a better macro environment in H2 2014,” said commodity strategist at ANZ bank Daniel Hynes.
In data last night, US existing home sales surprised to the upside, coming in at 5.04 million in June, while the Richmond manufacturing index also beat expectations, returning to 7, and US HPI rose 0.4 percent, after failing to show gains in April.
US Core CPI in June was 0.1 percent, the lowest reading since February and CPI dropped to 0.3 percent.
Tomorrow investors will eye the all important HSBC Flash Manufacturing data out of China to gauge the country’s metal demand. Forecast is expecting numbers to be at 51.2 versus last month’s 50.7.
The copper price at $7,045 per tonne was up $5 on the previous day’s close, while stocks fell 875 tonnes to 157,125 tonnes and cancelled warrants declined 825 tonnes to 38,900 tonnes. Volumes are light still and the metal traded within a $22 range.
Aluminium last at $2,039 is just $1 off Tuesday’s kerb close. Stocks continue to fall and at 4,938,150 tonnes equalled the September 2012 lows. Cancelled warrants were also lower, falling 7,075 tonnes to 2,903,800 tonnes.
Zinc prices at $2,364 is $2 higher, although this morning it traded to a peak of $2,371 this morning, not far from its highest since August 2011 at $2,373. Stocks continue to decline, falling 400 tonnes to 656,275 tonnes.
The lead price was last at $2,215, $2 lower on the previous close. Still, stock movements have been dull, there was no changes today, with 213,725 tonnes held in warehouses – of which 11,375 tonnes are cancelled warrants.
Nickel prices were back in above $19,000 as it digested news of Russian sanctions. It was last at $19,010, a $10 increase despite stocks rising 150 tonnes to 311,214 tonnes – a fresh record high.
Tin at $22,100 was $25 lower in price while stocks were 25 tonnes higher.
