London Metal Exchange (LME) metals put on a strong showing at the close of trade on Monday with aluminium, lead and zinc at or near highs and copper consolidating above $4,200 a tonne, dealers said.
"Metals are defying gravity, reality and any bearish developments," Maqsood Ahmed, analyst at Calyon said, pointing recent copper selling by the Chinese and low domestic prices versus the LME.
Three-months copper closed at $4,223 a tonne, down $13 from Friday's kerb close but building a base for further gains.
"Buy dips is about all the advice we can give. It's too risky to sell at these prices. The funds want to buy. They are not scared about acquiring at these levels because they don't have to add economic value," a trader said. "All they are interested in is making a return."
Barclays Capital, reporting on a recent trip by its analysts to China, said sentiment on copper was mixed but "uniformly positive" in aluminium and zinc.
Aluminium touched a fresh 10-1/2 year peak of $2,118 earlier and at the close three months was $11 stronger at $2,116.
The market peaked at $2,155 in February 1995.
China is expected to double tax on primary aluminium exports to 10 percent in January next year in a further move to cool investment in the energy-hungry aluminium sector, industry officials and traders said.
Beijing might also reduce a tax rebate for exports of aluminium products to six percent from 11 percent in January. Analysts said this could prove supportive in the near time.
The world largest miner, BHP Billiton, said it expected China to continue to be the main driver of aluminium demand, consuming 20 million tonnes per year by 2015, against global demand of over 50 million tonnes.
Zinc edged up to a new 15-year high at $1,690 at the close, up $20.
Lead was also firmer at $1,017, up $17. In the kerb it reached $2,018, the contract's highest since it switched to dollars from sterling in the early 1990s.
Nickel weaker at $13,000 from $13,045, while tin was off by $25 at $6,100.