Paring the previous session's slide of one per cent, copper prices on London Metal Exchange (LME) rose yesterday, while Shanghai metal ticked lower with prices seen range-bound ahead of China's trade numbers expected tomorrow.
Three-month copper on the LME rose $40 to $7,510 a tonne. In the previous session, the market touched $7,629.75, just off a two-month high before closing down one per cent on the day. After sharp gains early last week on the back of Chile's 8.8 magnitude earthquake, copper prices slipped into a trading pattern range-bound by the 10-day moving average on the downside and recent two-month highs above $7,600 on the upside.
"There is a bit of a data vacuum that will be filled on Wednesday and Thursday," said David Moore, a commodities strategist at Commonwealth Bank of Australia. "It will be interesting to see how the market interprets copper imports. If they are down, the market will discount that because of the Lunar New Year holiday. If they are up, it could result in a kick-up in prices."
"There is not a lot of direction. People are trading the ranges ahead of the China numbers. The influences are the dollar and stockpiles," said a trader in Hong Kong. "The inventory data looks pretty supportive on the face of it – there is certainly a downtrend developing and the high level of cancelled warrants makes me think the declines will continue."
LME inventories have fallen 9,000 tonnes since March 2 to 541,575 tonnes and cancelled warrants have risen to 5.5 per cent of the total inventory. Benchmark third-month Shanghai copper fell Y250 to Y60,230 and the most active June contract slipped half per cent to Y60,370.
Nickel fell $25 to $22,275, but remains near last week's 21-month high.
Aluminium dipped $3 to $2,228. Aluminium fabricator Novelis said global demand growth for the metal would increase at a four per cent pace in 2010, with the emerging markets driving the growth, and it expects prices to show a slight positive uptrend.
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