LONDON, Mar. 29 -- Copper gained for a third day and nickel climbed to the highest price since June 2008 as falling stockpiles boosted investor confidence in global demand.
Prices rallied after London Metal Exchange copper inventories fell for the 18th day to 516,925 tons on March 26, the longest period of declines since July 2009. Nickel supplies in LME warehouses decreased for a sixth day to 155,922 tons.
"Declining LME copper stocks has been a positive for the copper price," David Moore, commodity strategist at Commonwealth Bank of Australia in Sydney, said in an e-mail today. "Anticipation of international economic recovery has been a supportive factor for base metals, although confidence in this outlook was shaken at times."
Copper for three-month delivery on the LME rose as much as 1.8 percent to $7,651 a metric ton, the highest price since March 8, before trading at $7,634 at 11:49 a.m. in Singapore. The metal has advanced 3.5 percent this year, headed for its fifth quarterly gain, on expectation demand will increase as the global economy rebounds.
Stockpiles of copper tallied by the Shanghai Futures Exchange dropped 8.1 percent last week, the largest decrease since December 2009.
Futures also advanced as the dollar fell for a second day against a basket of six major currencies after the European Union and International Monetary Fund pledged last week to help Greece finance the region's biggest budget deficit if it runs out of options in capital markets.
Nickel, the best performing metal on the LME this year, jumped to the highest price since June 13, 2008. The contract for delivery in three months traded up 3.2 percent to $23,345 a metric ton at 11:42 a.m. Singapore time after earlier rising as much as 3.4 percent as a fall in stockpiles was "taken as evidence of improving demand," said Moore.
Among other LME-traded metals, aluminum rose 1.1 percent to $2,245 a ton, zinc climbed 1.9 percent to $2,272 a ton, lead gained 0.7 percent to $2,140 a ton and tin rallied 0.9 percent to $17,825 as of 11:38 a.m. in Singapore.