METALS-London copper above $6,000/T; up 2nd day as base metals rally
(Adds analyst comment, updates prices) BEIJING, Aug 21 (Reuters) – Base metals prices rose on Tuesday, with London copper climbing for a second day and crossing the $6,000-a-tonne mark as the dollar slipped, while the market awaited U.S.-China trade talks in Washington. Copper prices on the London Metal Exchange have fallen by 18 percent from a four-year high touched on June 7 amid concerns a trade row between the United States and China, which have slapped billions of dollars in tariffs on each other’s goods, will hit demand for industrial metals. But Jefferies analyst Timothy Ward wrote in a note that the “pendulum may have swung too far too fast.” “Sentiment and positioning have shifted so strongly from these macro forces that the underlying copper story may have been thrown out with the bath water,” he said, adding that the last time speculative positioning had so many shorts and so few longs, copper rallied 19 percent over the next three months.
FUNDAMENTALS
* LME COPPER: Three-month copper on the LME rose as much as 0.9 percent to a one-week high of $6,046.50 a tonne and was trading up 0.7 percent at $6,037 a tonne by 0705 GMT.
* SHFE COPPER: The most-traded October copper contract on the Shanghai Futures Exchange closed up 1.3 percent to 48,700 yuan ($7,084.67) a tonne after hitting its highest since Aug. 15.
* USD: The dollar index against a basket of six other currencies fell 0.3 percent to 95.583 after touching 95.440, its lowest level since Aug. 9. A weaker greenback makes metals cheaper for holders of other currencies and can support prices.
* VEDANTA: India’s environment court said on Monday an independent judicial committee would decide in about six weeks whether to allow Vedanta Ltd to reopen its copper smelter, which was shut by the southern state of Tamil Nadu on environmental grounds.
* OTHER METALS: Zinc was the star performer, closing up 3.1 percent in Shanghai after breaking through its 7-day moving average, and added 2.2 percent in London. Shanghai aluminum jumped 2 percent and nickel rose 1.2 percent, while tin was the sole laggard, losing 0.3 percent.
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MARKETS NEWS
* Asian stocks rose on Tuesday, supported by hopes Beijing and Washington would dial back trade hostilities, though comments from the U.S. president about the yuan and Federal Reserve policy capped gains and weighed on the dollar.
PRICES
BASE METALS PRICES 0721 GMT Three month LME copper 6030 Most active ShFE copper 48700 Three month LME aluminum 2067.5 Most active ShFE aluminum 14700 Three month LME zinc 2427 Most active ShFE zinc 20580 Three month LME lead 1998.5 Most active ShFE lead 17545 Three month LME nickel 13745 Most active ShFE nickel 112830 Three month LME tin 18780 Most active ShFE tin 142870
BASE METALS ARBITRAGE
LME/SHFE COPPER LMESHFCUc3 781.23 LME/SHFE ALUMINIUM LMESHFALc3 -1649.14 LME/SHFE ZINC LMESHFZNc3 770.03 LME/SHFE LEAD LMESHFPBc3 920.35 LME/SHFE NICKEL LMESHFNIc3 2449.01
($1 = 6.8740 Chinese yuan)
(Reporting by Tom Daly; editing by Richard Pullin and Sunil Nair)
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