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Copper, Zinc Pare Losses as Dollar Reverses; Aluminum Advances

iconApr 28, 2010 15:53
Source:SMM

SHANGHAI, Apr. 28 -- Copper, zinc and lead pared losses as the dollar fell against the euro. Aluminum advanced.

Three-month delivery copper traded 0.2 percent lower at $7,476 per metric ton on the London Metal Exchange after dropping to $7,373 a ton, the lowest price since March 26. Zinc was down 0.5 percent at $2,350 a ton after falling 1.4 percent. Aluminum climbed 0.9 percent to $2,170 a ton.

The dollar lost 0.2 percent against the euro to $1.3207, reversing an earlier gain. The Dollar Index, which gauges the currency against six counterparts including the euro, lost 0.3 percent, after rising the most in five weeks yesterday as equities tumbled. Standard & Poor's slashed Greece's rating to junk, and cut Portugal's by two steps, fueling concern that a debt crisis will spread through Europe.

"The ratings cuts triggered a flight to safety, which is probably overdone when it comes to base metals," Zhou Hualiang, an analyst at Shenhua Futures Co., said from Shenzhen. "We don't see it as time yet for copper to tumble, as we're still in China's high-production season."

Copper in Shanghai fell 3.1 percent after tumbling as much as 4.4 percent to 57,960 yuan ($8,490) a ton, the lowest since March 16. Aluminum declined 1.9 percent after slumping as much as 4.8 percent to 15,660 yuan, the lowest level since Dec. 1, 2009, and zinc was down 2.4 percent after losing as much as 4.4 percent to 18,080 yuan, the lowest since March 2.

"Base metals plunged on increased risk aversion and a stronger U.S. dollar after the credit rating cuts for Portugal and Greece," Natalie Robertson, an analyst at ANZ Banking Group Ltd. said in an e-mailed report today.

"Positively, falls in LME inventories continued to support the demand outlook," Robertson said. Increased canceled warrants for copper in Asia, mainly China, "suggest the potential for strong April copper import figures."

Copper inventories monitored by the LME have shrunk 9 percent from this year's high on Feb. 18. Cancelled warrants, or stockpiles earmarked for delivery, were near the highest in seven weeks yesterday.

Lead dropped 1.4 percent to $2,268 a ton, nickel declined 1.2 percent to $25,625 a ton and tin tumbled 2.2 percent to $18,150 a ton.

 

 

Aluminum Al
copper Cu
lead Pb
nickel ni
tin Sn
zinc Zn

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