Base Metals Modestly Higher
Dec 30th, 2008 | By Doug Casey | Category: Financial NewsThe base metals were all in the green in light post-Christmas trading on Monday. Copper noodled around within a tight 4-cent range the whole day, finishing at $1.3115/lb., up more than 2 cents from Friday. Nickel had a good day, advancing to $4.409/lb., up 17 cents. Zinc moved slightly higher, closing at $0.5164/lb., up three-quarters of a cent. Aluminum posted a modest gain to $0.6868/lb., up more than a penny, while lead had a very strong day, adding nearly 4 cents, to $0.4177/lb.
Copper benefited from the strength in crude and the shakiness of the dollar, most of which had to do with the amped-up strife in the Middle East. Analysts generally believe any rally will be short-lived as demand destruction continues apace.
Supporting the pessimistic view were stockpiles that show no signs of slackening in their buildup. Copper inventories monitored by the LME gained another 5,250 metric tons yesterday, to 336,700 tons. Stocks have now risen 70% on the year, and are at their highest levels since February 2004.
The amount of copper now in LME and Shanghai warehouses is equivalent to 7.4 days of global demand. In contrast, the average was for 2007 was 4.9 days.
There was also sector-wide commodity strength, as the Reuters/Jefferies CRB Index of 19 raw materials climbed as much as 1.3%, led by energy and metals.
And aluminum got some support from stockpiles which have finally begun to ease a bit. November inventories were 1.4% lower than in October, according to a report from the International Aluminium Institute.
While stocks declined to 1.6 million metric tons from almost 1.63 million tons in October, the IAI said, they are still well above year-ago levels, which were 1.47 million tons in November 2007.
Source: Base metals modestly higher - Copper inventories higher, but aluminum stocks drop
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