Another Bloomberg story. Nickel is up $600 a tonne today too.
Copper Posts Its Biggest Gain in 6 Days as Dollar Rally Falters
2005-04-06 05:32 (New York)
By Chanyaporn Chanjaroen
April 6 (Bloomberg) -- Copper posted its biggest gain in six
days in London after the dollar's rally against currencies such
as the euro faltered, boosting the metal's appeal as an
alternative to U.S. assets.
The dollar gained as much as 2.2 percent against the euro
since March 22, when the U.S. Federal Reserve raised its target
rate. The euro was 0.2 percent higher at $1.2888 as of 10:05 a.m.
in London. For the past year, copper in London has had a
correlation coefficient of 0.82 compared with the euro against
the dollar. The maximum reading is 1.
``It's the dollar effect,'' Nick Moore, an analyst at ABN
Amro Futures Ltd. in London, said in a telephone interview.
Copper for delivery in three months rose $25, or 0.8
percent, to $3,260 a metric ton on the London Metal Exchange. It
earlier rose as much as 0.9 percent, its biggest intraday gain
since March 31. The contract has gained almost 12 percent in the
past year, boosted by declining copper stockpiles.
Inventories of the metal at warehouses monitored by the LME
rose 625 tons, or 1.4 percent, to 46,175 tons, the exchange said.
Gains were reported in Bilbao, Spain and Long Beach, U.S.
Stockpiles are still 74 percent lower than a year ago, drained by
demand from China, the world's largest copper consumer.
``The deliveries are still small,'' Moore said. ``We need to
see increases in terms of thousands of tons and persistence
before any price reaction.''
Investors remain reluctant to build short positions, or bets
that prices will fall, Robin Bhar, an analyst at Standard Bank
London, said in a e-mailed report yesterday.
``LME stocks are trending higher but there is as yet as
little sign off substantial increases, in spite of reports of
good availability of metal,'' Bhar said.
Hedge Funds
Still, hedge-fund managers and other large speculators have
cut their positions in copper for three consecutive weeks in New
York. They held a net 25,605 copper futures in the week ended
March 29, 29 percent less than three weeks ago, according to data
from the U.S. Commodity Futures Trading Commission.
Hedge funds account for half of trading on the LME, Barclays
Capital in London estimated.
Other LME contracts also rose. Aluminum rose $9, or 0.5
percent, at $1,941 a ton; nickel added $100, or 0.6 percent, to
$15,800; lead climbed $12, or 1.3 percent, to $954; tin was up
$75, or 0.9 percent, to $8,125 a ton; and zinc rose $7, or 0.5
percent, to $1,362.
--Editor: Wallace, A. Brown |
