Copper and nickel up

Copper jumped to a three-month high on Thursday on rising demand and supply shortages, while nickel hit a new record peak and zinc surged 5 percent. Generally higher base metals prices helped boost shares of London-listed miners such as BHP Billiton, Anglo American, Xstrata and copper miner Kazakhmys, which all rose between 3 and 6 percent.
While the FTSE index of 100 shares was up 2 percent. London Metal Exchange copper for three-months delivery traded up to $6,548 a tonne before ending the day's open outcry trade at $6,530 compared with $6,220 at Wednesday's close and up around 7 percent since the start of March. "Metals held their ground over the past days, but the funds coming in has driven the prices up aggressively today," a trader on the LME floor said."
Base metals prices have held firm despite recent sharp declines in major equity markets. Analysts say the market is watching low physical metal stocks and tight supplies. "While the complex remains vulnerable to broader macro-economic sentiment and equity market volatility, base metals markets fundamentals remain extremely supportive," analysts at Barclays Capital said in a market report. Copper stocks in LME warehouses fell 1,625 tonnes to 196,125.
Backwardation -the premium for cash metal over the three-month future - in copper rose to around $60, its highest since last July. Nickel futures for three months delivery hit a new record high at $47,890 compared with a close of $44,800/44,900 on Wednesday.
"Nickel made a new high on each day of this week ... and new supply, which could ease the tensions, is not on the horizon," Dresdner Kleinwort said in a research note. Nickel stocks in LME registered warehouses fell 222 tonnes to 3,594, of which only 2,466, or less than one day of global consumption, are on warrant and available to the market. It finished trading at $47,100. Zinc closed at $3,315 from Wednesday's close of $3,220, slightly below a session high of $3,380.25.
"Copper, aluminium and zinc have rallied... as sentiment has been bolstered by gains in equities, stabilising/falling LME stocks and production cuts (aluminium)," UBS said in a research note. Aluminium closed at $2,789 from $2,715. Traders said loss of output from Ghana would help buoy aluminium prices.
Ghana's Valco aluminium smelter said on Thursday it will shut down indefinitely from Friday due to chronic power shortages in the West African country. The 200,000-tonne-a-year smelter is jointly owned by Ghana's government and US-based aluminium giant Alcoa Inc. It is currently operating at 30 percent of its capacity.
Lead was up at $1,910/1,915 from $1,870, while tin firmed to $13,750 against Wednesday's close of $13,500. Earlier tin hit a session peak of $13,925, a whisker away from its record high of $13,950 set on February 22.
Traders said problems in Indonesia and tight market conditions continued to support tin. Dozens of small-scale smelters ceased operations on Indonesia's tin-producing Bangka island last October after a crackdown on illegal smelting and mining that has damaged the environment, raising fears of supply disruption.