Aug 15, 2011 (Dow Jones) -- --Base metals close mixed after largely drifting in quiet session
--Markets supported by weak dollar, firm equities; investors still cautious
--LME copper hovers below resistance around $9,000/ton
--Metals expected to continue to take direction from macro news, equity markets
By Rhiannon Hoyle
Of DOW JONES NEWSWIRES
LONDON (Dow Jones)--Base metals closed mixed after drifting sideways in quiet trade throughout most of Monday's session, and market participants say they expect prices to await cues from macro developments and world equity markets in the days ahead.
Copper for three-month delivery on the exchange finished the afternoon open outcry at $8,907 a metric ton, up 0.5% on Friday's PM kerb close.
While analysts expect the red metal's volatility to lessen after a turbulent few weeks across world financial markets, copper continues to struggle with resistance around the key $9,000/ton market, they say.
In other metals, three-month zinc closed 0.3% higher at $2,183/ton, while three-month aluminum finished 1% lower at $2,374.5/ton.
"The markets have been largely drifting today, oh-so-quietly," a London-based trader said.
Firmer European stocks helped the metals as risk sentiment improved, with Euro Stoxx 50 having ended up 0.7% at 2324.48 in a relatively calm session following last week's volatility.
While a weaker dollar also supported the dollar-denominated metals' prices, the markets remain nervous--with many investors unwilling to significantly rebuild their risk exposure given the uncertain growth outlook.
Standard Bank analyst Leon Westgate said: "Its worth noting that the overriding theme across much of the base metals complex has been one of higher LME open interest and falling prices, signifying the addition of new short positions.
"While this opens up the potential for short covering, if the prevailing sentiment is now for lower prices, the metals may find it hard work to sustain any rallies," he said.
Prices in dollar a metric ton.
3 Months Metal Bid-Ask Change from
Friday PM kerb
Copper 8907.0-8908.0 Up 42
Lead 2398.0-2399.0 Up 18
Zinc 2183.0-2184.0 Up 7
Aluminum 2374.5-2375.0 Dn 24.5
Nickel 21300.0-21305.0 Dn 100
Tin 24450.0-24500.0 Dn 200
Aluminum Alloy 2260.0-2270.0 Dn 25
Aluminum Alloy-NASAAC 2410.0-2420.0 Dn 40