Copper at 1-year high despite analysts' caution

Print this page Posted on : 10-24-2009 by recycleinme.com

London, Oct. 23

Copper climbed to a fresh one-year high on Friday, as equities marched higher on improving corporate earnings and analysts warned prices had over run weak fundamentals.

Copper for three-month delivery on the London Metal Exchange rose to $6,655 a tonne in rings from $6,585 at the close on Thursday.

The red metal used in power and construction earlier touched $6,686 {ndash} a level last seen on Sept 29, 2008 {ndash} and is on course for its biggest weekly gain since July.

''Metals continue to trade in line with the broader market and equities sentiment,'' said Andrey Kryuchenkov, analyst at VTB Capital.

Analysts were cautious, suggesting prices had risen too high against a backdrop of rising inventories even though demand for industrial metals was expected to rise in 2010.

LME copper stocks continue to climb, indicating demand has yet to recover outside China, the world's largest metals consumer.

Latest data showed inventories rose 3,000 tonnes to total 367,075, their highest level since mid-May and a rise of about 40 percent since July.

Other metals

In other metals, aluminium rose $19 to $1,985 a tonne in LME rings after earlier touching a two-month high at $2,000.

LME stocks for the metal, used in transport and packaging, fell 5,275 tonnes to remain near record highs above 4.5 million tonnes.

Steel making ingredient nickel was untraded in official rings, but bid at $19,500 from $19,200 while battery material lead traded at $2,430 in LME rings from $2,405.

Zinc traded at $2,295 a tonne in LME rings from $2,250 and volatile tin edged up to $15,100 from $15,000. Earlier, tin rose to a $15,600, its highest since mid-June.

Zinc touched $2,293.50, it's highest peak since May 2008, with analysts citing improving physical demand.

Source : Business Line