SHANGHAI, May 3 (SMM) – LME nickel prices overnight opened at USD 17,795/mt, with the high end USD 17,864/mt, finding support at USD 17,285/mt. Finally, LME nickel prices closed at USD 17,350/mt, down USD 410/mt. Trading volumes increased by 2,000 lots to 4,319 lots, and total position was 106,492 lots, down 268 lots. LME nickel inventories were 103,896 mt, down 6 mt.

LME nickel prices overnight fluctuated narrowly awaiting directions from European and US data. As eurozone PMI was disappointing, and since unemployment rate in Italy and Germany rose, the US dollar index climbed, pushing down LME nickel prices to close at USD 17,350/mt, down USD 410/mt. the number of US employment increased by 119,000, down from previous 209,000 and much lower than the forecast of 175,000, depressing market confidence. As a result, LME base metal prices plunged, pushing down Shanghai metal prices. The market is focusing on US non-farm employment data for April, and if it turns out negative, speculations of the QE3 implementation should grow.

US will announce non-farm employment rate and jobless claims for last week today, and LME nickel prices should remain cautious ahead of the data. LME nickel prices should move between USD 16,800-17,800/mt; spot nickel prices should be lowered to RMB 127,000-131,000/mt.