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Nickel and copper LME prices boosted by Fed comments |
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Nickel and copper led London Metal Exchange prices higher Friday, as traders said prices rose ahead of comments from both the U.S.Federal Reserve Chairman and President George W. Bush.
The comments helped push equities higher, but then metals in London heldsteady as traders in the U.S. prepared for the long weekend.
Copper closed the kerb session at $7,450 a metric ton, up $50 from Thursday'sclose. LME nickel closed up $1,495 at $29,795/ton while LME lead bucked thetrend and ended $65 lower at $3,100/ton.
U.S. Federal Reserve Chairman Ben Bernanke said: "The further tightening ofcredit conditions, if sustained, would increase the risk that the currentweakness in housing could be deeper or more prolonged than previously expected,with possible adverse effects on consumer spending and the economy moregenerally."
However, he said the Fed is prepared to take the necessary steps to ease theimpact of financial market disruptions. Traders said this was expected and thatmost buying was done ahead of the speech.
Copper prices held after Bernanke spoke, despite indications that growth mayslow more than the broader financial markets expect. Standard Chartered analyst Helen Henton said it cause some speculative positions to sell out of the marketgiven roughly 50% of copper's use is in construction. However, she saidcomments remain vague and larger global fundamentals such as consumption growthin China remain supportive.
Analysts also said that a large 6,500-ton draw from weekly Shanghai stockdata Friday piqued concerns the seasonal build in copper stocks may not be ashigh as last year.
LME nickel prices moved higher mostly on technical selling, traders said.
LME nickel hits a one-month high of $30,500/metric ton on a "technicalbounce," spurred by positive sentiment in the base metals complex, said SempraMetals analyst John Kemp. He added there is also some element ofshort-covering.
Nickel prices remained capped on both the up and downside, with support seenaround $20,000/ton, the point where pig iron is no longer cost effective,analysts said. But some nickel price recovery is expected later in the year. back to the News |
