Copper rose on Friday and nickel prices rebounded from a one-month low after regulators in China pledged support for firms with liquidity issues brought on by months of slowing growth. Both metals ended the week down, however, under pressure from a firmer dollar and the negative effects of a lingering trade dispute between the United States and China.
"Whatever words of support the Chinese officials are providing to non-state banks or struggling firms should also help support for other cyclical assets including base metals," ETF Securities commodity strategist Nitesh Shah said. "This would reduce the threat of demand falling away in the Chinese economy," he said. China is the world's top consumer of metals.
The benchmark copper contract on the London Metal Exchange (LME) closed 1 percent higher at $6,220 per tonne, but still ended the week more than 1 percent lower. LME nickel ended 0.8 percent higher at $12,445 after slumping to its lowest since Sept. 18 on Thursday.
Production cuts ordered for this winter by China's top steelmaking city Tangshan look less restrictive than last year, analysts said, potentially keeping output high even as the city seeks to fight pollution by cutting smokestack smog.
China's economic growth in the third quarter slowed to its weakest pace since the global financial crisis, and missed expectations, as a years-long campaign to tackle debt risks and the trade war with the United States began to bite.
China's primary aluminium production fell for a second straight month in September, sliding to its lowest level since May as weaker aluminium prices and higher input costs led smelters to cut back output.
LME nickel stocks have slumped 43 percent since this time last year to about 220,000 tonnes. In warehouses monitored by the Shanghai Futures Exchange, zinc stocks jumped 23.3 percent to 53,479 tonnes from a week ago while copper stocks rose 12 percent to 140,789 tonnes.
China's daily steel output hit a record high of 2.7 million tonnes in September, as mills in the world's top producer cashed in on strong profit margins before the start of winter production curbs aimed at tackling smog. Aluminium rose 0.5 percent to $2,023 per tonne, zinc finished 2.1 percent to $2,653, lead fell 0.5 percent to $1,991.50 and tin gained 0.7 percent to $19,170.