London 13/05/2016 - Base metals continued to look vulnerable, struggling to maintain gains in Friday LME trading following Thursday's declines.
Copper eked out a small gain after falling to a two-and-a-half-month low of $4,600 in yesterday's session after the release of weaker-than-expected US economic data and amid a steady dollar and slide in the oil price.
"There is nothing to get excited about. It is one step forward and two steps back at the moment. Until physical demand picks up then we will keep treading these well-worn paths," a copper trader said.
Poor Chinese data has done little to improve sentiment. The country's M2 money supply at 556 billion yuan undershot the expected 820 billion yuan while new loans at -3.6 percent missed the projected -2.8 percent.
"China is a key concern. No one knows what direction it will head, there are different opinions trying to influence but the end game is no one knows for sure what is going to happen," a second floor trader said.
In other data, the European flash GDP reading at 0.5 percent also missed the forecast 0.6 percent. US retail sales in April at 1.3 percent beat the forecast of -0.3 percent. Core retail sales, which exclude automobiles and gasoline, came in at 0.8 percent, better than the expected 0.6 percent.
The PPI at 0.2 percent was slightly below the 0.3 percent forecast while core PPI at a 0.1 percent was in line.
Attention will now turn to further data from China - its industrial production, fixed asset investment and retail sales are all scheduled for release over the weekend.
In the metals, copper closed at $4,627 per tonne, up $14 on Thursday's close. Inventories fell a net 3,800 tonnes to 156,675 tonnes and cancelled warrants dropped 3,700 tonnes to 36,525 tonnes.
Meanwhile, SHFE stocks have fallen more than 26,000 tonnes; there is growing speculation that metal will continue to move from there to LME warehouses in the coming weeks.
Aluminium at $1,535 was down $10; stocks fell 4,825 tonnes to 2,584,400 tonnes.
Nickel closed $20 higher at $8,650 - stocks fell 1,674 tonnes to 412,344 tonnes. In a move centred on Vlissingen, cancelled warrants dropped 4,116 tonnes to 120,720 tonnes. The cash/May date is looking tight at a small contango of just $1.
Zinc at $1,888/1,889 was up $18, with stocks and cancelled warrants both down 1,125 tonnes at 390,375 tonnes and 25,375 tonnes respectively. Lead finished at $1,708, down $2, after a marginal stock increase of 25 tonnes to 176,075 tonnes.
Tin closed at $16,655, down $20. Stocks rose 100 tonnes to 6,425 tonnes - the highest since September last year - with the Port Klang and Singapore totals steadily rising.
Cobalt was indicated at $23,250/23,750; cancelled warrants rose three tonnes to 63 tonnes. Steel was indicated at $65/115 and molybdenum at $14,800/15,300.
(Editing by Mark Shaw)