SHANGHAI, Apr. 19 (SMM) -- LME nickel market overnight opened at USD 17,850/mt, with the highest and lowest level of USD 17,950/mt and USD 17,650/mt, respectively. Finally, LME nickel market closed at USD 17,721/mt, down USD 90/mt from a day earlier. Transactions for the day were 2,842 lots, up 745 lots. Positions were 105,387 lots, down 874 lots. Inventories were 99,624 mt, up 768 mt.

LME nickel prices climbed slightly yesterday, but as Spain will sell long-term government bonds later on Tuesday, LME nickel prices edged lower to close at USD 17,721/mt due to resurfacing investor concerns, down USD 90/mt.

LME base metal prices failed to extend the upward trend overnight but moved on a downward track. Market concerns intensified ahead of Spain's government bond auction, since markets believe the bond auction will offer a fresh test of confidence in its economy. Spain will auction up to EUR 2.5 billion of two- and 10-year bonds on Thursday. If Spanish yields keep rising or its bond sales are bearish, market concerns over Spanish financial conditions will intensify. It seems that markets are pessimistic toward Spain's government bond auction, weighing down global commodity markets.

Spain's two- and 10-year bonds sales are the market focus today. Previously, market rumors reported that the successful Spanish bond sales on Tuesday were caused by human factor and the European Central Bank was only interested in buying German government bonds, and these rumors weighed down base metal prices.

SMM predicts LME nickel prices will move narrowly between USD 17,500-18,000/mt today ahead of Spain's government bond auction. If the bond sales are successful, LME nickel prices may increase to USD 18,000-18,500/mt, but if the bond sales are bearish, LME nickel prices may fall to USD 17,200-17,500/mt. Domestic spot nickel prices may fall slightly to RMB 128,000-131,500/mt today.