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BASE METALS: Metals Close Mostly Higher As Traders Square Books
Feb 14,2011 09:36CST
industry news

LONDON, Feb. 14 -- Base metals ended mostly higher on the London Metal Exchange Friday as weekend book-squaring steadied prices in late afternoon trade.

"The market was protecting itself by going short this morning, but then in the afternoon the markets covered what they went short for--nobody wanted to be terribly exposed over the weekend," a London trader said.

Market focus was on Egypt, where Hosni Mubarak stepped down as president and handed over power to the army.

The news drove Brent oil and gold lower, but reaction to the announcement is "yet to be realized" across the base metals, Sucden said in a trading note.

Market players warned that, with prices still at elevated levels, investor nervousness is likely to cause some volatility early next week.

Deutsche Bank said in a note to clients that the strength in the industrial metals complex "looks to be losing momentum."

"While the market expects strong buying by China as manufacturers return from the Lunar New Year, there is a possibility that they baulk at the current high prices and defer purchases over the near term," it said. "This and some reemergence of risk perceptions globally could put some temporary pressure on the complex."


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