London 19/09/2016 - Base metals apart from copper ended Monday LME trading in positive territory, with nickel in particular performing strongly into the close, climbing above $10,000 to a one-week high.
Volumes have picked up today after China returned to the market, having been absent since Thursday for national holidays - almost 13,000 lots of copper changed hands on Select by the kerb close and nearly 11,000 lots of zinc.
There was no data of note today but traders will be playing close attention to central bank meetings this week, including those of the Federal Reserve and the Bank of Japan. The FOMC committee, which meets from Tuesday, will announce policy along with its latest economic projections on Wednesday.
Most market participants do not anticipate a rate rise in September although the probability of this taking place in December has increased after better-than-expected inflation data last Friday.
"This might just mean we get a bigger relief rally in the face of the 'no change' that we and most of the market expects [on] Wednesday night. A rise in rate would be a major market shock," National Australia Bank said.
The nearby curves will be watched with interest over the next two days - this week is 'Third Wednesday' when the September date will become prompt.
There is one holder in the cash position in aluminium at 30-39 percent. Nickel has one across all three reported positions at 30-39 percent and zinc has one across all three positions at 50-79 percent.
In the metals, copper came off a four-week high on reports that Anglo American restarted operations at Los Bronces following industrial action. It concluded at $4,776 per tonne, down $12 on Friday's close.
The metal had hit a four-week high last week, eyeing $4,800 after better-than-expected Chinese data lifted sentiment.
"Chinese copper buying picked up at the end of August as the market returned from the long summer break, helped by the arb window reopening, and prompting a bounce in physical premia," Citibank said in a note.
"That said, the high LME deliveries have been almost matched by draw trends in SHFE and Chinese bonded copper inventory levels, suggesting an inventory shift rather than builds of new material," it added.
Stocks rose a net 625 tonnes at 349,625 tonnes due to arrivals into Busan and cancelled warrants climbed 2,825 tonnes to 57,975 tonnes, a move also centred on Busan.
In the rest of the metals, aluminium at $1,583 was $7.50 higher; stocks and cancelled warrants both fell 5,450 tonnes to 2,161,475 tonnes and 865,675 tonnes respectively.
Nickel ended at $10,150, up $425 and at a one-week high - it has found support from reports that the Philippines could suspend more nickel mines following an audit by the Philippines Department of Natural Resources (DENR), the results of which is due Thursday.
"[The audit] may prompt a brief price rally, if closures exceed expectations. Longer-term, we see a market deficit forming, despite modelling Indonesia offsetting a Philippines cut - as global stainless steel demand extends its lift from 2015's lows," Morgan Stanley said in a note.
More than 7,000 lots traded on Select by the close.
Stocks fell 108 tonnes to 366,858 tonnes and cancelled warrants fell 264 tonnes to 116,652 tonnes.
Zinc was last at $2,251, up $36, after stocks edged 50 tonnes lower to 444,400 tonnes. Lead at $1,953 was up $16.50; stocks increased 300 tonnes to 188,150 tonnes.
Tin concluded at $19,350, an increase of $250. It remains supported by a continued stock fall - inventories fell another 10 tonnes to 3,825 tonnes today.
Steel billet was last indicated at $300/325 and cobalt and molybdenum at $26,500/27,000 and $15,750/16,250 respectively.
(Additional reporting by Kathleen Retourne, editing by Mark Shaw)