LONDON: Nickel fell on Tuesday, leading a broad-based pullback in base metals prices after weaker than expected economic data from top raw materials consumer China sparked concerns over demand.
Nickel, chiefly used in stainless steel, is still correcting from a surge to two-year highs this month on hopes for a bounce in demand for electric vehicles.
“The Chinese data out earlier today was broadly speaking negative. They paint a view of the Chinese economy where growth looks to be slowing,” Danske Bank analyst Jens Pedersen said.
“The way we see China here in the big picture is for credit tightening, which is feeding through to the real economy, and that will mean lower demand for base metals.”
Nickel, which has risen nearly a quarter this year, could be due a deeper correction, he said. “We are still at elevated levels, so in the short term nickel is perhaps more sensitive to negative news.”
NICKEL PRICES: Three-month nickel on the London Metal Exchange was untraded in official midday rings, but was last bid down 1.3 percent at $12,3300 a tonne, after surging 3.1 percent on Monday. Earlier this month it reached its highest since June 2015 at $13,030 a tonne.
CHINA COOLS: The economy in China cooled further last month, with industrial output, fixed asset investment and retail sales missing expectations as the government extended a crackdown on debt risks and factory pollution.
LME COPPER: LME three-month copper was down 0.5 percent at $6,863 a tonne in official trading.
COPPER TECHNICALS: Copper may test support at $6,849 a tonne, a break below which could cause a loss to the next support at $6,803, Reuters technical analyst Wang Tao said. These supports mark the 38.2 percent and 50 percent Fibonacci projection levels of a downward wave C.
FREEPORT-MCMORAN: The Indonesian unit of Freeport-McMoRan Inc closed the main access road to its giant copper mine in the eastern province of Papua on Tuesday for the second time in three days after another shooting.
ZINC PRICES: LME zinc was 0.7 percent lower in official trading at $3,191 a tonne.
OTHER METALS: The other metals were untraded in official rings. LME tin was last bid down 0.3 percent at $19,450 a tonne, while lead was down 1.2 percent at $2,492 and aluminium was 0.1 percent lower at $2,105 a tonne.
ALUMINIUM STOCKS: Stocks of aluminium in LME-registered warehouses fell another 4,050 tonnes, data showed on Tuesday, taking them to their lowest in nine years at 1.165 million tonnes.
Source: Brecorder.com
