Copper edged higher on Monday, supported by falling inventories and a monthly upturn in China's property prices, with gains capped by a firmer dollar. Benchmark copper on the London Metal Exchange ended 0.8 percent up at $6,828 a tonne, having posted its second weekly decline on Friday.
"Housing prices in China were a bit firmer, which is important in copper," said Capital Economics commodities analyst Caroline Bain, adding that construction accounts for about half of Chinese copper demand. "I'm slightly wary because rising housing prices don't necessarily mean there is going to be a flurry of construction activity, particularly as credit conditions are quite tight."
On-warrant LME inventories in approved warehouses dipped to the lowest level in more than two months at 147,799 tonnes. On-warrant stocks are those not earmarked for delivery and are available to the market. Prices for new homes in China rose at a slightly faster pace in October after gains had held steady the previous month.
Argonaut said in a report that China's underlying fundamentals in the property sector remain sound and that any commodity price rout during the weak winter season in China would be short term. Hedge funds and money managers' net long positions in copper futures in the week to Nov. 14 were cut to the lowest level since July, the US Commodities Futures Trading Commission said on Friday.
Philippines President Rodrigo Duterte has not lifted a ban on open pit mining, his spokesman said on Monday, despite calls for the ban's removal. Capping gains in copper was the dollar index which added 0.3 percent. A stronger dollar makes copper more expensive for holders of other currencies.
Nickel ore output fell 11 percent in the nine months to September as several mines remained shut under the government crackdown and others were hit by bad weather. Brazil's Vale SA on Monday denied that it had decided to postpone the sale of a stake in the New Caledonia nickel mine, saying it is continuing to look for a partner.
Nickel closed with a 0.7 percent gain at $11,655 a tonne. The global lead market swung into a deficit in September while the zinc market deficit widened slightly from with the previous month, data from International Lead and Zinc Study Group showed on Monday. Aluminium finished 0.8 percent down at $2,086 a tonne, lead slipped by 1.2 percent to $2,460, tin fell 1.5 percent to $19,450 and zinc eased by 0.5 percent to $3,163.
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