Base Metals Mixed
May 21st, 2009 | By Doug Casey | Category: Gold MarketThe base metals were mixed again on Wednesday. Copper was only slightly higher until the New York open, when it busted up to its peak of $2.09 in the late morning, then subsided to finish at $2.0756/lb., up better than 3 cents. Nickel was up and down sharply all day, to little effect as it closed at $5.6442/lb., up a penny and a quarter.
Zinc was very weak early but rebounded to end at $0.6648/lb., down less than a penny. Aluminum was off modestly, giving up a third of a cent, to $0.6602/lb., while lead declined through most of the day, winding up at $0.6532/lb., down almost a penny and a quarter.
Copper finished for the second straight day in positive territory, as equities showed some early life and the dollar weakened.
“The downtrend in the U.S. dollar is attracting a lot of buying interest into the broader commodity complex,” said Michael Gross, futures analyst with Optionsellers.com in Tampa, Florida.
Technicians were also at work yesterday. “There was strong technical momentum from a buy signal triggered on Monday at $2.047 a pound,” said Larry Young, of Infinity Futures in Chicago.
Sounding a cautionary note was the International Copper Study Group, which said that the world copper market experienced a surplus of 86,000 metric tons in February, compared with a deficit of 61,000 tons in the year earlier period.
Stockpiles continue to dwindle. Copper inventories monitored by the LME were off 7,350 metric tons yesterday, to 341,475 tons.
In company news, Jiangxi Copper, China’s top integrated producer, said it will meet its 2009 output target of 800,000 metric tons of refined copper, despite repair work on an oxygen generator at its main Guixi smelter.
And Aluminum Corp. of China (NYSE:ACH), the nation’s biggest aluminum producer, announced that it will sell 10 billion yuan ($1.5 billion) worth of debt to help fund its acquisitions and expansion of copper assets.
Proceeds will be used to fund the previously announced acquisitions of Peru Copper and Yunnan Copper Group, and also to help fund three copper strip projects in Luoyang, Shanghai and Daye.
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Doug Casey is a contrarian investor, sought-after public speaker and author of several books. His work "Crisis Investing" held the position of # 1 bestseller on the New York Times list for 26 consecutive weeks. Doug's unusual views on the economy - and just about everything else - have gained a huge following in the investment community, and it certainly helps that his stock recommendations of undervalued junior exploration companies have made his subscribers millions. Now in its 27th year, Doug's monthly newsletter, the International Speculator, is one of the most established and esteemed publications on gold, silver and other natural resource investments. Together with the Casey Energy Speculator, it covers a broad range of carefully selected stocks with the very real potential of double- and triple-digit returns within 12 to 24 months.