London 29/09/2016 - Base metals apart from nickel ended Thursday LME trading in positive territory - tin climbed above $20,000 per tonne to its highest since January last year, lead its strongest since last May and aluminium and zinc multi-week highs.
Lacking any direct drivers, the complex took its lead from higher oil prices, a trader said. Spot crude surged to three-week highs of $49.48 per barrel early in Asia following reports that OPEC members have reached an initial deal to cut oil output.
OPEC agreed on Wednesday to reduce its oil production to 32.5 million barrels per day from 33.24 million barrels per day, Reuters reported. The deal is set to be formalised in November.
"With lead and tin setting fresh highs and the others running up to challenge resistance levels the market is looking bullish and we would not be surprised to see the run continue," FastMarkets head of research William Adams said.
"The next focal point is likely to be on Saturday's release of the Chinese manufacturing PMI - any sign that demand may be improving could add fuel to the rally," he added.
Still, there could be some choppy end-of-week moves and book squaring because the end of the month coincides with a week-long absence from China from Monday for a national holiday.
In the metals, copper concluded at $4,842 per tonne, up $24 on Wednesday's close, having earlier peaked at $4,860 on reports of a power outage in Australia that forced BHP to suspend operations at its Olympic Dam copper-gold mine.
Stocks increased a net 10,100 tonnes to 379,175 tonnes - a move centred on New Orleans, where inventories climbed 7,075 tonnes to 46,675 tonnes.
Lead climbed to its highest since May last year on news that Nrystar's Port Pirie furnace faces two weeks of closure. It concluded at $2,062.50, up $65.50. Stocks fell 300 tonnes to 190,700 tonnes.
Tin climbed above $20,000 during kerb trading - it ended at $20,025/20,050, up $215 and its highest since January last year. Stocks, which were unchanged for today, are at historical lows.
Zinc closed at $2,356, up $24 and around its highest since September 6. There is a backwardation on the cash/Oct date of $4. Stocks and cancelled warrants both fell 675 tonnes to 439,975 tonnes and 27,200 tonnes respectively.
While a Nyrstar smelter restart has had little impact on prices, they could come under pressure if other producers follow suit.
"In this case the supply deficit on the global zinc market would probably turn out to be not quite as high as currently anticipated," Commerzbank said.
Aluminium climbed to its highest since August 23. It was last at $1,671, up $6 - stocks fell 4,875 tonnes to 2,128,750 tonnes and cancelled warrants were down 3,875 tonnes to 862,800 tonnes.
Nickel ended at $10,435, down $260, despite news that the Philippines has ordered the suspension of another 20 more mines. Stocks climbed 564 tonnes to 362,448 tonnes.
Steel billet was last indicated at $300/325 and cobalt and molybdenum at $27,000/27,500 and $14,650/15,150 respectively.
(Additional reporting by Kathleen Retourne, editing by Mark Shaw)