Copper at 19-month high

Copper hit a 19-month high on Tuesday on earlier gains by the euro and a rise in risk appetite but the market was waiting for further evidence of demand recovery to support the rally. Benchmark copper for three-month delivery on the London Metal Exchange was untraded in the rings but was last bid at $7,849 a tonne, from $7,770 at the close on Monday.
Copper's rally lifted aluminium, tin and zinc to multi-week highs. Copper, used in power and construction, touched $7,878 a tonne, its highest since August 2008, as the euro hit a one-week high against the dollar on relief that debt-laden Greece was able to raise funds from the market.
"It is of course a relief," said Andrey Kryuchenkov, analyst at VTB Capital. Copper is on course for a 15 percent rise this quarter, and analysts see prices maintaining the upward trend from April, as economic activity improves. Many financial markets will be closed on Friday and Monday for holidays. Aluminium hit $2,314 a tonne, its highest since January 19 and closed at $2,294 a tonne versus $2,283. LME stocks for the metal, used in transport and packaging, rose 30,075 tonnes to remain near all-time highs above 4.6 million.
Aluminium stocks hit a near nine-month low at 4.513 million tonnes on March 12. Much of those stocks are tied up in finance deals, to release cash for producers and to earn banks higher returns than they would get in money markets. In other metals, nickel rose to $24,300 a tonne, just below its 21-month high of $24,498 a tonne hit on Monday.
Funds have been active in nickel. Latest LME data showed a dominant position controlling between 50-80 percent of cash warrants. The discount between the cash and three-month contract was at $35 a tonne, versus $83 on March 1. Market sources said New-York based hedge fund Touradji Capital Management was betting on improved demand for nickel, helping the material used in stainless steel outperform other base metals this year.
LME data also showed two positions controlled between 40-50 percent of lead cash warrants. The discount between the cash and three-month contract, was at $29.50 a tonne, compared to $38.30 in mid-December. Battery material lead was last bid at $2,135 from $2,151. Zinc rose to $2,390 a tonne, its highest in almost three weeks and ended at $2,380 a tonne from $2,332. Tin also gained to an over 2-week high and was last at $18,370 a tonne from $18,025.