Aluminium Drifts, Copper Better

Lower technicals after recent producer selling saw aluminium drift below expected support at $1,600 a tonne by the London Metal Exchange (LME) midsession.

Elsewhere, copper recovered from its lows but was unable to move towards $2,600 resistance, while nickel deriving support from disruptions at producers Inco and Norilsk streaked higher.

Aluminium held softer levels after drifting lower in late inter-office trade on Thursday and largely ignored a stocks fall of 3,775 tonnes.

It was last at $1,585, down on Thursday's LME kerb close of $1,615.

Traders said they expected a period of consolidation at current levels but did not rule out a further retracement towards $1,580 or possibly lower given the backdrop of down trending charts and the lack of strong buying interest. "Producer selling is continuing to be seen on rallies, which suggests that some capacity restarts will be seen in the near future," broker GNI said.

Copper snapped from a low of $2,572 to settle at $2,583, up $3, but never looked like challenging resistance at $2,600.

The market continues to remain tight, with the Inco strike removing about 9,000 tonnes of copper production from the market each month, Flemings Global Mining Group said.

In Korea, LG Metals said the market had no need to worry about its current open metals options positions. Traders in London said copper's rally to a 13-month peak of $2,609 on Thursday was fuelled by options covering, and some players attributed a sudden slide in futures to an out-of-ring deal between LG Metals and a major US investment bank.