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SMM Morning Review - 2011/12/23 Nickel Market
Dec 23,2011 09:44CST
smm insight
Source:SMM
In China’s nickel spot market, overnight LME nickel price decline will weigh on nickel prices to move in the RMB 129,000-131,000/mt range on Friday.

SHANGHAI, Dec. 23 (SMM) -- LME nickel LME nickel for delivery in three months opened at USD 18,920/mt and closed at USD 18,615/mt, down by USD 330/mt from a day earlier, with the highest price at USD 18,999/mt and the lowest price at USD 18,600/mt. Daily trading volumes were 1,562 lots, down by 469 lots. Positions were 109,751 lots, down by 469 lots from a day earlier.  LME nickel inventories were down by 1,668 mt to 89,568 mt.      

LME nickel prices still failed to breakthrough USD 19,000/mt and fell to USD 18,600/mt. Trading volumes and positions both fell to great extent in LME nickel market due to growing risk aversion sentiment before Christmas holiday, LME nickel inventories also increased significantly.

According to data announced on Thursday from the US Department of Labor, last week's initial jobless claim unexpectedly fell to the lowest since April 2008, indicating that the labor market is recovering in the US. In addition, the US University of Michigan consumer confidence index for December and the Conference Board leading economic indicator for November both vaulted market expectation. Meanwhile, Italy Senate passed austerity plan with a vote of 257 to 41, paving the way for EUR 20 billion austerity plan. The upbeat economic data from the US boosted market sentiment, and the pass of austerity plan in Italy also stoked investors’ confidence. In this context, the US and European equity markets advanced and LME base metal prices railed across the board. Shanghai Composite Index and Shenzhen Composite Index both fluctuated down after a low open on December 22nd, new lows in 33 months, with trading volumes also at low levels in 2011. The sluggish performance of China's stock markets will weigh on Shanghai base metal prices in the near term. It is expected that trading volumes will be thin during the last trading days before Christmas holiday.

Despite of positive economic data from the US, LME nickel prices were still limitedly supported and continued to be weighed. It is expected that LME nickel prices will meet resistance at USD 19,000/mt during the last trading day ahead of Christmas holiday. In China’s nickel spot market, overnight LME nickel price decline will weigh on nickel prices to move in the RMB 129,000-131,000/mt range on Friday.

 

nickel; nickel price; LME nickel price; spot nickel price; European debt crisis; US dollar; euro; Dec. 23; in the Shanghai nickel spot market;

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