Copper rises; tin hits 14-month high
Aluminum LME inventories strike record high
LONDON — Copper rose on Friday, bouncing from the previous day's losses as the dollar retreated from multi-month highs against the euro.
Copper for three-months delivery on the London Metal Exchange traded at $6,908 (U.S.) a tonne at 1045 GMT from a close of $6,870 on Thursday.
The U.S. dollar slipped against a major currency basket, having hit a 3-1/2 month high versus the euro on Thursday.
“It's because the dollar has weakened again,” said Stephen Briggs, commodity strategist at RBS.
“The base metals survived this extraordinary move in the dollar extremely well. And now that the dollar has stopped rising that's an opportunity to push them back up again.”
A weaker U.S. currency makes dollar-priced commodities cheaper for holders of other currencies.
Tin, at $15,900 from $15,775, earlier hit a 14-month high of $16,000, as analysts cited worries about production cuts in Indonesia, the world's top exporter of the metal.
Capping sentiment, copper inventories rose again, up 1,775 tonnes to an 8-month high of 476,350 tonnes.
Copper has more than doubled this year on the back of hefty buying by China, but purchasing by the world's top consumer has cooled and OECD demand is still languishing.
But some see prices continuing to rise in 2010.
“Come the new year we would expect more money coming into commodities because of fresh fund inflows,” said Calyon analyst Robin Bhar.
“We expect 2010 to be a stronger year for growth, with better demand.”
Record Aluminum Stocks
Aluminum traded at $2,250.25 from $2,220. LME stocks of the metal used in transport and packaging struck a record high above 4.6 million tonnes after climbing 1,375 tonnes.
Japan's primary aluminum buyers have agreed to roughly 7-13 per cent hikes in premiums for the first quarter of next year, to a 14-year high, as Japan's apparent aluminum demand has finally recovered close to levels seen before the financial crisis.
Zinc was at $2,440 from $2,391 and battery material lead was at $2,355.50 from $2,359.
Nickel was at $17,230 from $17,100. Stocks of nickel rose 768 tonnes to 148,458 tonnes, their loftiest level since 1994 and just 3,000 tonnes below record highs.
A slew of U.S. economic indicators released on Thursday painted a mixed picture, pointing to a steady economic recovery but a struggling labour market.