LONDON, Sep 09, 2010 (Dow Jones Commodities News via Comtex) --
Base metals on the London Metal Exchange ended mostly lower Thursday, with stronger equity markets and upbeat U.S. data unable to pull the complex back into positive territory after its sharp losses in early Asian trade.
Equities climbed through the afternoon, following a U.S. Labor Department announcement that weekly jobless claims fell more than expected. Sentiment was also lifted by a Commerce Department report showing the U.S. trade deficit contracted sharply in July, posting its biggest drop in 17 months.
And while the metals took an initial boost from the news, it was not long before market participants cashed in on the higher prices, sending them lower again.
LME three-month copper closed 1.6% lower at $7,554 a metric ton.
"Unless market risk picks up substantially in the coming days, we believe value lies below $7,300/ton in copper," Standard Bank analyst Walter de Wet said.
Meanwhile, three-month zinc closed down 3% and three-month aluminum ended 2.5% lower. Tin managed slim gains.
Prices suffered early from an aggressive selloff during Asian trade as rumors circulated that Chinese authorities were investigating positions in the rubber market.
Reports of further monetary tightening in China added to investor nerves, de Wet said.
Moreover, market players say a pickup in speculative activity has also increased volatility in the markets.
Prices in dollar a metric ton.
3 Months Metal Bid-Ask Change from
Wednesday PM kerb
Copper 7554.0-7555.0 Dn 120
Lead 2200.0-2201.0 Dn 34
Zinc 2152.5-2153.5 Dn 66.5
Aluminum 2105.0-2106.0 Dn 55
Nickel 22725.0-22750.0 Dn 175
Tin 21700.0-21725.0 Up 25
Aluminum Alloy 2115.0-2116.0 Dn 25
Aluminum Alloy-NASAAC 2116.0-2117.0 Dn 29