London metals scored fresh highs on Wednesday, on fund buying supported by positive fundamentals and a weaker dollar, dealers said. "The story remains the same. The news flow is strongly favourable and further dollar weakness has fuelled the buying," Barclays Capital analyst Ingrid Sternby said.
Copper peaked at $8,110 a tonne earlier in electronic trade and closed at $8,070, up $255 from Tuesday's kerb close. Fund buying pushed other commodities higher, with gold at a new 25-year high, aluminium at its best in 18 years and nickel, zinc and platinum at fresh all-time peaks.
"We are still long within an overall uptrend. We are reducing slightly, but that is only a response to the daily volatility rather than any long-term change in sentiment," a source at a system-based fund said.
Analyst Maqsood Ahmed at Calyon said: "Copper is the flagship, driving the other metals higher and money keeps coming into the market."
"Inflation is still a concern so you hold commodities against that, the dollar is getting weaker, gold is going up and LME stocks are not going anywhere - all these factors support," he added.
The dollar dropped to one-year lows against European currencies with investors betting there will be a pause in US interest rate rises. The euro was last up 0.3 percent on the day at $1.2803, having earlier hit a one-year high of $1.2813.
Dealers were now looking at $9,000 and $10,000 as new targets for copper. The metal has risen by around 85 percent this year on speculative buying, strong demand and concerns over supply disruptions.
"I think we are going towards $10,000," Sternby said. On the supply side Grupo Mexico said it would close one of its copper, silver and zinc mines. According to the Reuters Metals Production Database the San Martin mine in Zacatecas is not particularly big. Its capacity is just over 30,000 tonnes per year of contained copper and around 26,000 contained zinc.
Aluminium touched a fresh 18-year high of $3,100 and closed at $3,095, up $82. Zinc hit a new record high of $3,660 at the close, up $185. Stocks in LME warehouses fell by 625 tonnes to 252,800, a fresh five-year low. Nickel was up $550 at $20,450 and lead gained $32 at $1,312.
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