Zinc prices slipped on Thursday after inventories rose, indicating supplies were healthy. Aluminium gained after the United States imposed tariffs, while other metals were supported by strong manufacturing data in top metals consumer China.
Zinc inventories in warehouses certified by the London Metal Exchange jumped seven per cent to 245,750 tonnes, the highest since November. They have surged 84 per cent since late February.
‘There’s certainly inventory out there and with a more restrained import appetite into China so far this year, it’s not surprising that you’ve see some metal showing up in LME warehouses,’ said Nicholas Snowdon, metals analyst at Deutsche Bank in London.
‘Overall, however, the trends in the zinc market have been quite encouraging in China over the past few weeks, namely stock draws and the import arb (arbitrage) opening up,’ he added.
Other metals gained after data in China showed its vast manufacturing sector grew at the fastest pace in eight months in May, blowing past expectations and easing concerns about an economic slowdown.
‘The macro (economy) and metals data we’ve seen out of China over the course of May has been on the positive side, providing a clear balance to the negative macro risks that have developed ex-China,’ Snowdon added.
* ZINC: LME benchmark zinc slipped one per cent in final open outcry trading to $US3,100 a tonne, pulling back from a one-month high of $US3,164.50 after LME stocks data were released.
* COPPER STOCKS: LME copper on-warrant inventories – those stocks not earmarked for delivery – jumped 19 per cent in one day to 226,675 tonnes.
* ALUMINIUM: LME aluminium ended one per cent firmer at $US2,292 a tonne after the United States said it was moving ahead with a 10 per cent tariff on aluminum imports from the European Union, Canada and Mexico.
* COPPER: LME copper rose 0.2 per cent to finish at $6,852 a tonne, off an intraday peak of $US6,895.50.
* COPPER SPREADS: LME time spreads in copper had been tightening, with the discount of the cash contract to three-month futures moving to $US7.25 a tonne by Thursday’s close from a $US34.75 discount on May 21.
The move was a result of investors covering short spread positions, Alastair Munro at broker Marex Spectron said in a note.
* NICKEL: LME nickel, the best performing LME metal this year, closed up 0.6 per cent at $US15,220 a tonne, the highest since April 19.
The most-traded July nickel contract in Shanghai closed up 2.5 per cent at 114,820 yuan ($US17,933.62) a tonne, having earlier touched 114,870 yuan, its highest level since May 2015.
* PRICES: Lead gained one per cent to end at $US2,459 while tin edged up 0.1 per cent to $US20,600.