Copper rose towards the psychological $8,000 level on Wednesday, in tandem with a weaker dollar, with positive quarterly earnings boosting sentiment towards riskier assets - including some key commodities. Official growth data from China, the world's top metals consumer, is due on Thursday but a further boost to buyers came as sources said earlier the country's economy grew about 11.9 percent in the first quarter, topping expectations.
Copper for three-months delivery on the London Metal Exchange closed at $7,950 a tonne, up $50 from Tuesday, while fund buying boosted nickel to its highest in almost two years.
The US currency eased after Singapore effectively revalued its currency - seen as a mark of confidence in economic recovery. A weaker dollar makes metals priced in the US currency cheaper for holders of other currencies.
"With many metals now at new highs, there is certainly a positive feel about the place," said one LME trader. "As long as the fund money keeps flowing, then it can only remain at these levels." Used in power and construction, copper gained 140 percent last year and is up about 8 percent so far this year, driven by Chinese and fund buying, improving macro data and a weaker dollar.
Often a demand indicator, copper stocks in LME warehouses fell 975 tonnes to 509,650 tonnes, down from six and half year highs at 555,075 on February 17. Aluminium traded at $2,455 versus $2,436 and earlier touched its highest level since September 2008 at $2,462.
Earlier this week, Russia's UC RUSAL, the world's biggest aluminium producer, said it is considering launching an aluminium exchange traded fund (ETF), that could lock up more than 1 million tonnes of the metal. "Rusal has indicated that it is preparing to launch aluminium ETF backed by 1mt of physical metal," said investment bank Fairfax in a note. "Creation of such a fund should raise investment demand for the metal and could support prices."
Among other metals, steel ingredient nickel closed at $26,400 from $25,525 on Tuesday, after hitting $26,395, its highest since May 2008. "CTAs (commodity trading advisers) are very favourable towards it. It's hitting fresh highs and the momentum goes, they keep buying it," Thurtell at Citi said, adding BHP Billiton's mine closure was also supporting the prices.
Global miner BHP Billiton has suspended operations at part of its Nickel West mining complex in west Australia after a miner died in an accident there. While battery material lead was at $2,360 from $2,370. Zinc gained $70 to $2,460 a tonne and tin was last quoted at $18,845/18,850 from $18,610.