LME ends mixed, eyes US hurricane

31 Aug, 2005

Metals on the London Metal Exchange ended mixed on Tuesday, with some traders cautious over possible hurricane damage to warehouses in New Orleans. Otherwise, copper's reluctance to re-test the recent all-time high tended to inhibit other markets, traders said.
"It is thin and nervy - it is a short week and not everyone is back from holidays and closures, and it doesn't take much to move it around," one said.
"They (price moves) are all about copper. Lead, zinc and most of the others have just tagged along for the rider," he said.
Zinc is the metal most likely to be affected by Hurricane Katrina, which inflicted catastrophic damage all along the US Gulf coast as it slammed into Louisiana with 140 mph (224 kph) winds, then swept across Mississippi, Alabama and Tennessee.
LME data show 1,100 tonnes of copper, 1,200 tonnes of aluminium and 248,825 tonnes of zinc in New Orleans. Global LME zinc stocks total 561,950 tonnes.
"The LME has around 24 warehouses in the New Orleans area which may be affected, and as a result we are monitoring the situation closely," an LME spokesman said.
"Due to communications lines being down in the New Orleans area it is unlikely that we will be able to fully evaluate the impact on LME warehouses for several days," he added.
Price moves were undramatic, however, and last trade was at $1,359 a tonne, up $4 from pre-weekend levels.
Copper was supported by widening spreads, and repeatedly nudged up towards intermediate resistance around $3,650, although attempts to spike the metal towards the $3,670 target by the close failed.
Last business was at $3,645, up $45 from last Friday. The cash/threes spread was around $245 backwardation.
Aluminium mostly trended lower, but picked up technical support near $1,860, and ended at $1,873, against a previous $1,892.50.
Elsewhere, lead was $1 higher at $866, nickel eased $50 to $14,775, while tin was at $6,980/7,000, versus $7,050.

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