LONDON: LME nickel resumed trading on Wednesday and slid to its lower limit, while aluminium and other industrial metals prices climbed on hopes of more stimulus in China.
Nickel slid 5% to its lower limit on the London Metal Exchange after being suspended for a week, with electronic trading halted for several hours due to technical issues.
LME electronic trade restarted at 1400 GMT in thin trading, with many more potential sellers than buyers, traders said.
“The physical people see it limit down and expect it to go limit down again. I don’t think anyone wants to pay that price yet,” said Robert Montefusco at broker Sucden Financial.
The LME said it was considering raising its 5% price limit for Thursday, a move traders said would help the market close a gap of more than $8,000 between the LME and rival Shanghai Futures Exchange.
In contrast with lower nickel prices, three-month aluminium on the LME rose 1.5% to $3,3235 a tonne in official open-outcry trading. Benchmark copper added 2.2% to $10,119.
“We’re seeing metals prices moving higher, which you can understand because tightness is still there,” said Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen.
“The market also liked the news from China that they want to keep markets stable and do what they can to mitigate any risks,” Hansen said. “LME nickel is on its own, completely dislocated.”
China, the world’s biggest consumer of base metals, will roll out policy steps favourable for its capital markets, Vice Premier Liu He said.
Data released on Tuesday also showed China’s economy perked up in the first two months of 2022, although a surge in Omicron cases, property weakness and heightened global uncertainties weighed on the outlook.
China’s Tsingshan Holding Group has reached agreements with two companies to swap its nickel products with a purer form of the metal to close out large short positions it holds on the LME, state-backed Shanghai Securities News said.
Indonesian state miner PT Aneka Tambang’s nickel ore production and sales doubled in 2021 from a year earlier, the company said on Wednesday.
In other metals, LME zinc rose 0.7% to $3,825, lead added 1% to $2,264.50, but tin shed 0.2% to $43,000.
Comments
Comments are closed.