SHANGHAI, Jul. 26 (SMM) – LME nickel prices overnight opened at USD 15,611/mt, with the high end USD 16,020/mt, finding support at USD 15,520/mt. Finally, LME nickel prices closed at USD 15,963/mt, up USD 250/mt. Trading volumes increased by 546 lots to 3,274 lots, and total position was 105,465 lots, down 1544 lots. LME nickel inventories were 111,762 mt, up 1,182 mt.
As euro zone will likely offer banking license to the ESM, LME nickel prices rebounded. Once ESM gains banking license, European central bank will receive sufficient capital for the bailout. Expectations of QE3 implementaion grew due to recent sluggish US economic data. In this context, LME nickel prices closed at USD 15,963/mt, up USD 250/mt.
LME base metals prices stopped falling and rose as the market was boosted by European central bank's statement. Nowotny, European Central Bank Governing Council member and President of the Bank of Austria said in an interview European central bank plans to issue banking license to the ESM, which had been opposed to the measure. On other hand, France is supportive for the move since it can use European central bank's low financing cost capital. Meanwhile, Moody's downgraded ratings of 17 banks in Germany and their outlook from steady to negative. But as Nowotny's statement boosted market confidence, base metals prices rose slightly.
LME nickel prices should move between USD 15,600-16,100/mt today, and domestic spot nickel prices should move between RMB 113,700-116,500/mt.