LME CLOSE - Metals end mixed, some pegged back after recent gains

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Martin Hayesmartin.hayes@fastmarkets.com+44 (0) 20 7337 2148

London 06/09/2016 - Base metals traded at mixed levels on the LME on Tuesday, with some setting fresh highs, although profit-taking was evident amid increased business levels - US markets reopened following the Labor Day holiday weekend.

"Volumes have picked up this week and we are seeing more activity. Tin is having a good run on supply concerns and falling LME inventories, a floor trader noted.

Tin set a fresh high since January 2015 while nickel perked up to a two-week best. But zinc and lead were pegged back by profit-taking - these metals had hit their highest since mid-2015 on Monday.

On the data side, the US ISM non-manufacturing PMI undershot at 51.4 against a forecast 55.4, as did the IBD/TIPP economic optimism index at 46.7 - a reading of 48.6 had been anticipated.

Attention now turns to Wednesday's LME September traded options expiries. Further ahead, investors are now awaiting data from China for more direction - trade numbers are due on Thursday ahead of CPI and PPI inflation readings on Friday while industrial production, retail sales and fixed asset investment readings are scheduled at the start of next week.

In the metals, copper held comfortably above $4,600. It closed at $4,620 per tonne, down just $5 on Monday's close. Earlier, warehouse stocks increased a net 6,450 tonnes to 334,975 tonnes - the increase was again centred on Asia. Inventories are now at their highest since September 2015. Cancelled warrants slipped 800 tonnes to 44,375 tonnes.

Aluminium, which yesterday fell to its lowest in around three months, edged back to $1,589, up $9. Stocks and cancelled warrants both fell 3,900 tonnes to 2,212,275 tonnes and 918,125 tonnes respectively. Aluminium stocks are now at their lowest since December 2008.

Tin hit $19,670 before closing at $19,450, still up $55. Stocks fell 50 tonnes to 4,410 tonnes, the lowest since March this year.

Nickel was last at $10,110, up $40, having peaked at $10,225. News that the Philippines authorities are reviewing export activity and growing reductions of nickel ore exports have been supportive for the metal, Sucden noted.

Meanwhile, inventories climbed 138 tonnes to 367,896 tonnes but the stockpile remains near its lowest since October 2014. 

Zinc ended at $2,321, a drop of $39, although stocks had fallen 575 tonnes to 449,925 tonnes and cancelled warrants climbed 775 tonnes to 22,600 tonnes. Lead slipped $23 to $1,946.50, with stocks and cancelled warrants both 225 tonnes lower at 187,000 tonnes and 67,075 tonnes respectively.

Steel billet was quoted at $300/325, cobalt at $25,250/25,750 and molybdenum at $16,000/16,500.

 (Additional reporting by Ewa Manthey, editing by Mark Shaw)



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