LIVE FUTURES REPORT 18/09: LME prices bounce back; copper recovers as stock increases come to a halt

The three-month lead and zinc prices rallied an average of 1.4% on Friday and both are trading 1% higher this morning.

“The supply tightness in lead has not eased as yet. Although the short-term recovery of [LME] stocks put some pressure on lead prices, spot premiums still moved higher and now [Shanghai Futures Exchange] lead stocks have fallen quickly – the cycle continues,” Galaxy Futures noted.

Copper prices have also bounced back this morning trading $68 per tonne higher after sharp declines last week following large warehouse increases. LME stocks this morning, declining for the first time in a week.

“The corrections in the LME base metals appear to have run their course with the recent dips attracting buying… We have been on the lookout for base building and another buying opportunity, which may now be unfolding. We wait to see if follow-through buying emerges as the week progresses,” William Adams, Metal Bulletin’s senior analyst, said.

The dollar’s rebound has halted for now lending some slight support to the base metals, as it dips back below 92.00.

Nickel prices bounced back after dropping over 5% last week. However, the repercussions from further exports licenses being issued in Indonesia should continue to impact the market, ANZ Research noted.

Copper price recovers

• The three-month copper price was up $68 to $6,575 per tonne.
• In spreads, cash/three-month continues to widen, it is now at $45.25 per tonne contango.
• The total net rise in stocks between September 12 and 15 was 95,925 tonnes.
• Stocks today fell a net 1,425 tonnes to 302,925 tonnes, with 13,700 tonnes freshly cancelled.

Base metals prices

• The three-month aluminium price was up $9.50 to $2,095.50 per tonne. Stocks declined 2,600 tonnes to 1,310,800 tonnes with 17,000 tonnes freshly cancelled – 13,950 in Port Klang and 3,050 tonnes in Singapore.
• Nickel’s three-month was up $90 to $11,180 per tonne. Stocks declined 606 tonnes to 383,472 tonnes.
• The three-month zinc price was up $52 to $3,083 per tonne. Stocks dropped 1,650 tonnes to 262,100 tonnes.
• Lead’s three-month price was up $43 to $2,402 per tonne. Inventories fell 225 tonnes to 162,900 tonnes.
• The three-month tin price was up $95 to $20,635 per tonne. Stocks dipped 25 tonnes to 1,930 tonnes.

Currency moves and data releases

• The dollar index was up 0.18% to 91.99.
• In other commodities, the Brent crude oil spot price was up 0.47% to $55.73 per barrel.
• The UK FSTE 100 is continuing to recover from its recent dip – up 0.33% to 7,239.41.
• In data today, the EU’s final CPI and the USA’s NAHB housing market index are of note.
• In addition, Bank of England governor Mark Carney is speaking.