Base Metals Above Lows At Mid-Session

Base metal markets edged up from earlier lows during yesterdays LME ring sessions, but the pace of trading remained slow.

Traders said the modest pick-up from the pre-market lows largely reflected copper fairly comfortably holding above $1,700 and some cash pricing purchases.

It has been a bit slow all day - there is a definite last day of the week feel about it, one said. Copper was initially soggy and showing signs of drifting back towards the $1,700 level, but was helped by stocks falling again by 1,525 tonnes.

Despite inventory falls, the KGHM mine strike and talk of good physical interest, the market may now stall at current levels, as overhead resistance is encountered. By the end of the kerb three months was at $1,723, up $13 a tonne from Thursdays kerb.

Analysts said the markets in general will be restrained by the macro-economic picture emerging in Japan, where the latest Tankan survey shows a depressed economy.

Aluminium, meanwhile, was unable to pick itself up to any degree, and prices continue to flirt perilously with the $1,400 level.

Inventory falls are being disregarded, with technicals have switched to the negative side. Last morning trade was at $1,409, unchanged from yesterday.

Lead and zinc continued to benefit from constructive short-term market sentiment. Lead was again underscored by a fall in stocks and a slight widening in the cash/threes backwardation to $3/5.

Zinc extended Thursdays consolidation above $1,100, and absorbed some expected profit-taking. It closed the kerb at $1,127, up $9, while lead gained $5 to $584/585. Nickel was softer, however, following the jerk lower on Thursday, although the market held above $5,400. Last business was at $5,430, down $25.Tin featured a sharp widening in the cash/threes backwardation as April tightness neared. The cash/threes spread was at $115/120, against $55 yesterday, while April/May was at $50/70 backwardation.

Three-months prices skipped up to $5,640, a $60 gain. Alloy was slow and traded at $1,285 a tonne, little-changed.