SMM Morning Review - 2010/8/6 Nickel Market

SHANGHAI, Aug. 6 (SMM) -- LME nickel for delivery in three months opened at USD 21,850/mt and closed at USD 21,860/mt on Thursday, up 10/mt from a day earlier, with the highest price at USD 22,139/mt and the lowest price at USD 21,750/mt. Daily trading volumes were 1,668 lots and positions were 88,357 lots. Inventories increased by 90mt to 117,780mt.

Base metal prices were weighed on the news of mortgage lending and bank test, coupled with worse-than-expected US jobless claim. It is reported that China planned to tighten mortgage lending in some cities and China's banking regulator recently asked banks to test the possible impact of a plunge in property prices on their loans and credit quality. The bank test as well as tightening of the mortgage lending will lead to worries on demand for metals. The US Department of Labor released on Thursday that the US jobless claim figure in the week ending on July 31 was 479,000, and the estimation from economists were 455,000/mt. The unexpected increase of jobless claim last week, which hit a four-month high, rekindled market concern over employment market. Close attention should be paid to the non-farm payrolls to be released tonight, which will help guide the market to certain extent.

It is expected that LME nickel prices will move between USD 21,500-22,000/mt on Friday.

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