Nickel, Copper, Other Metals Rally as Euro Rises Against Dollar
London, Oct. 31 (Bloomberg) -- Copper, nickel, lead and other
industrial metals rallied as the euro rose against the dollar for
a fourth day, making the metals cheaper for European buyers.
The European currency has gained about 3 percent against the
dollar since sinking to a record intraday low on Thursday, its
longest rally since mid-August. Today's gain was sparked by
evidence the U.S. economy is cooling and its growth advantage
compared with Europe is slipping.
``All base metals are trading high today, driven up by the
strengthening of the euro,'' said Ingrid Janson, a metals analyst
at Deutsche Morgan Grenfell. ``European metal consumers have been
suffering from a strong dollar.''
Nickel for delivery in three months rose $180, or 2.7
percent, to $6,980 a metric ton on the London Metal Exchange.
Copper rose $21, or 1.1 percent, to $1,861 a ton (84.41 cents a
pound). Lead rose 1.2 percent; zinc gained 0.8 percent; and
aluminum was up 1 percent.
In New York, copper for December delivery rose 40 cents, 0.5
percent, to 84.85 cents a pound on the Comex division of the New
York Mercantile Exchange.
Metal prices had fallen on investor concern that economic
growth may slow in the U.S. and Europe. Last week, nickel reached
a 13-month low in London, while copper declined to its lowest
since July and aluminum was the cheapest since June.
A shortage of metals, available from LME-monitored
stockpiles, is supporting the rally, analysts said.
``Supplies at the LME are tight,'' said Kevin Norrish,
minerals economist at Barclays Capital. Investors who sold metals
that they didn't own, betting that the price would fall, are now
looking for supplies to cover their positions.
Lowest Level
LME-monitored stocks of nickel were little changed at 11,532
tons today, close to their lowest level since December 1991.
Copper inventories fell 0.3 percent to 381,700 tons.
Nickel supplies may become even tighter because workers at
the world's No. 3 producer of the metal, Canada's Falconbridge
Ltd., are preparing to widen their strike, analysts said.
``There's further deterioration of relations between
Falconbridge and workers,'' Norrish said.
Falconbridge is trying to win a court injunction to stop
workers at its mines in Sudbury, Ontario, who have been on strike
since Aug. 1, from blocking movements of trucks and buses around
the mines. Last week, workers at a Falconbridge refinery in Norway
voted to walk off the job for a week beginning Nov. 12 to support
the Sudbury strikers.
--Vladimir Todres in the London newsroom (44 20) 7673 2347, or
vtodres@bloomberg.net/jah/tc/jb |
