Base Metals Mostly Lower
May 28th, 2009 | By Doug Casey | Category: Gold MarketThe base metals were nearly all in the red on Wednesday. Copper held up until the noon hour, but fell off steeply after that, finishing at its intraday low of $2.0752/lb., down more than 3¾ cents.
Nickel peaked over $6.20 during the pre-dawn hours, but it was all downhill from there, as it sank back below the $6 mark to close at its intraday low of $5.9164/lb., down 11 cents. Zinc was also up in the pre-dawn hours and cratered through the day to end at $0.647/lb., down two cents. Aluminum was very weak, giving up 2¼ cents, to $0.6199/lb., while lead bucked the trend, adding three-quarters of a cent, to $0.6505/lb.
Copper led most of the industrials lower, surrendering overnight gains and retreating from a 2½-week peak as the dollar strengthened again, leading to a general commodities selloff.
“There’s a lot more chatter about the dollar right now and it’s definitely becoming something more people are paying attention to,” said Matthew Zeman, of LaSalle Futures Group in Chicago. “It’s keeping a damper on prices.”
In addition, copper somewhat tracked equities lower after the mixed existing home sales data failed to provide any upward impetus.
“The [housing] supply number rose and I think people were hoping that number would drop by a small amount, and that’s kind of keeping copper a little heavy here,” said Sterling Smith, of FuturesOne in Chicago.
While stockpile data was supportive—copper inventories monitored by the LME were off by 7,300 metric tons yesterday, to 319,275 tons—traders responded more to a decline in canceled warrants, the metal tabbed for delivery, which have fallen to 43,375 metric tons from this year’s high of 84,000 tons on April 30.
In company news, Teck Resources (NYSE:TCK), Canada’s biggest base-metals company, is still trying to right its listing ship, now engaging in talks to sell coking-coal assets to Chinese companies.
Teck is seeking help to pay down $9.8 billion in debt incurred last year to buy Fording Canadian Coal Trust. Teck made the deal at the worst possible time, right before metals and energy prices plunged as the global recession spread.
Source: Base Metals Mostly Lower
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