The base metals were all in the red once again on Tuesday. Copper fell in the pre-dawn hours and, though it rallied through the New York session, never got back to even, finishing at $3.3221/lb., down 10¼ cents from Friday. Nickel fell during non-domestic trading Monday, then continued downward yesterday before moving up from the late pre-dawn hours through the New York day, finally closing at $8.793/lb., down a bit less than 37 cents.

Zinc was off sharply, then up equally sharply, ending little changed at $0.7888/lb., down three-quarters of a cent. Aluminum rallied strongly off its pre-dawn lows, winding up with a loss of less than a penny at $1.1995/lb., while lead was off significantly, shedding 4¾ cents, to $0.8475/lb.

Copper led the other metals downward as traders reacted to the rising dollar, falling oil, and their concerns about lackluster demand going forward.

Bears were crying the blues, for sure. “It’s gloom and doom [out there],” said Sean Corrigan, of Diapason Commodities Management. “The world has woken up to the fact that economies are weakening pretty much across the globe.”

Technicians were peering at their tea leaves, searching for direction as copper hit an intraday low of $7,150/metric ton, its lowest price since August 13. Corrigan said it was vital copper holds at $7,000.

“If it breaks [through that level] then the next move could be to $6,600 and all the way down to $5,800,” he said.

Also factoring in were rapidly expanding stockpiles. Inventories monitored by the LME were up yesterday to 179,800 metric tons, a gain of 6,425 tons since Friday.

And zinc dropped as various supply threats dissipated. Yunnan Chihong Zinc, China’s fifth-biggest producer, said it wasn’t affected by the August 30 earthquake, and Nyrstar NV (NYR), the world’s largest producer, said its U.S. smelter in Tennessee was unaffected by Hurricane Gustav.

Source: Base metals moribund -  Copper stocks continue to climb.