Not even copper rallying can help CMR it seems.UPDATE 5-Copper...

Not even copper rallying can help CMR it seems.

UPDATE 5-Copper rallies on soft dollar, stock drawdown
Mon Sep 22, 2008 2:47pm EDT Email | Print | Share| Reprints | Single Page | Recommend (0) [-] Text [+] Market News
Global stocks slip as U.S. bailout questioned
Dollar weighed by worry of U.S. bailout cost
Gold dips below $900, off 7-week highs
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¥ € $ - Learn. Practice. Trade. * Copper rallies on weaker dollar, lower stocks * Rise in aluminium stocks keeps a lid on prices * Lead rallies to two-week highs
(Changes headline, recasts, updates with New York closing copper prices,
adds analyst comments, adds ICSG data) By Agnieszka Flak LONDON, Sept 22 (Reuters) - Copper rallied to its loftiest level in
more than two weeks on Monday as the dollar slumped against the euro and
inventories fell in Asian warehouses, suggesting a pick-up of demand in top
consumer China. Lead rose to its highest level in two weeks and zinc reached a one-week
peak as metals rebounded from last week's sell-off. Copper for delivery in three months MCU3 on the London Metal Exchange
closed up 2.7 percent or $190 at $7,250 per tonne. On Thursday, it hit a
nine-month low of $6,625. Earlier, the metal, used in the power and construction industries, hit
$7,260 a tonne the highest since Sept. 4, helped by short position -- bets
on lower prices -- covering. In New York, copper for December delivery HGZ8 closed up 7.85 cents,
or nearly 2.5 percent, at $3.2550 a lb on the New York Mercantile
Exchange's COMEX division. "A weaker dollar is the overriding factor right now. As it weakens,
investors are looking for a hedge against that in some way and commodities
are seen as an easy way to protect money," Fairfax analyst John Meyer
said. The dollar slipped as investors awaited details of a planned $700
billion U.S. bailout of bad mortgage debt, likely the biggest bailout in
American history, capping a dramatic week in the U.S. financial markets.
[USD/] "It's a flight to quality," said Steve Platt, futures analyst with
Archer Financial Services in Chicago. "There is some movement out of U.S.
financial assets and maybe into hard assets on fears that the cost of the
bailout program might be inflationary down the road and a devaluing factor
in terms of the dollar. "I think that's drawing people back into commodities in a big way," he
added. CHINESE DEMAND Analysts said a 3,100-tonne fall in LME copper inventories, primarily
from the Gwangyang and Busan warehouses in Korea, suggested demand from
China, the world's largest importer and consumer of copper, was starting to
pick up. China's copper imports have fallen since the start of the year due to
soft demand, rising domestic output and high prices. China's imports of refined copper fell slightly on the year to 87,168
tonnes in August, and also were down from 88,075 tonnes in July, the
customs office said. [ID:nBJB000489] But demand appears to have risen 1.2 percent in August from July,
Reuters calculations based on trade data showed. [ID:nSP24116] The global copper market balance remained in deficit by 130,000 tonnes
between January and June this year, versus a deficit of 264,000 tonnes in
the corresponding year-ago period, the International Copper Study Group
(ICSG) said in its latest monthly bulletin. [ID:nN22455124] While the weak dollar has boosted base metals across the board, gains
in aluminium were capped by a 15,650 tonne rise in stocks to 1.35 million,
their highest level since March 2004. "Aluminium lagged the rest of the base metals because gains were
hampered by another sizable increase in inventories," said Standard Bank
analyst Leon Westgate. Aluminium MAL3, used in transport, packaging and power, closed up $13
at $2,548 per tonne from Friday's close and recovering from an eight-month
low of $2,490 reached last week. It hit a one-week high of $2,577 in earlier trade. Daily average primary aluminium output in August rose to 70,100 tonnes,
compared with 70,000 in July and 68,300 in August 2007, provisional figures
from the International Aluminium Institute (IAI) showed. [ID:nLM432924] Lead MPB3 closed at $1,990 from Friday's close of $1,900. It earlier
hit a high of $2,000, up 5.3 percent, last seen on Sept. 4. Tin MSN3 was last quoted at $17,600/17,700 a tonne from $16,900 on
Friday. Australia cut its estimates of annual zinc and nickel output, citing
falling prices and a domestic energy crisis, but kept a bullish outlook for
its giant mining industry despite fears of global recession.
[ID:nSYD369086] "This supports our view that there is scope for both (zinc and nickel)
to recover," Commerzbank said in a note. Nickel MNI3 closed $500 higher at $17,400 per tonne. Zinc MZN3 closed up $82 at $1,840 from Friday, after hitting a
one-week high of $1,844.
Metal Prices at 1838 GMT
Metal Last Change Pct Move End 2007 Ytd Pct move
LME Cu 7315.00 255.00 +3.61 6670.00 9.67
SHFE Cu* 54320.00 1860.00 +3.55 56880.00 -4.50
LME Alum 2542.00 7.00 +0.28 2403.00 5.78
SHFE Alu* 16100.00 280.00 +1.77 18180.00 -11.44
COMEX Cu** 329.50 11.00 +3.45 303.05 8.73
LME Zinc 1820.00 62.00 +3.53 2370.00 -23.21
SHFE Zinc* 14410.00 305.00 +2.16 18950.00 -23.96
LME Nick 17450.00 550.00 +3.25 26350.00 -33.78
LME Lead 1985.00 85.00 +4.47 2550.00 -22.16
LME Tin 17600.00 700.00 +4.14 16400.00 7.32
** 1st contract month for COMEX copper * 3rd contact month for SHFE AL, CU
and ZN SHFE ZN began trading on 26/3/07
(Additional reporting by Anna Stablum in London and Chris Kelly
in New York, editing by Michael Roddy)