Tin ends sharply lower, Copper firm

Profit-taking pressured London Metal Exchange three-month tin down over 5% Wednesday, but more surprising was perhaps that copper held steady, as recent oil strength offset bearish U.S. economic data and technical weakness.

Escalating tension between the U.K. government and Iran over 15 captured marines has buoyed oil prices near $65 a barrel, which has spilled over into copper price support, said Man Financial analyst Edward Meir.

He noted a 15% drawdown in inventories in March underpinning prices going forward, with the uptrend since February remaining intact.

Brokers and analysts had said earlier that copper looked at risk to a technical slide after failing to break above the 200-day moving average of $6,900 a metric ton Tuesday. Added to that were bearish signs for the U.S. economy with U.S. durable goods data up 2.5%, lower than expected.

But copper shrugged off profit-taking pressure early in the session lows to rise 1% on the day before retreating to $6,659/ton at 1728 GMT, down almost 4% from the week's high.

Meanwhile, three-month tin fell $790 to an intrasession low of $13,775/ton as investors booked profits ahead of month, quarter, and fiscal year end, after Tuesday's fresh record high of $14,600/ton.

"Those metals that are very illiquid...tend to get exaggerated.. what has gone up the most the day before, tends to get sold the next day," said UBS analyst Robin Bhar.

Tin has climbed almost 25% since the start of the year to fresh highs on the back of supply side concerns from Indonesia, which is the world's biggest producer.

The market is seen searching for a base around current levels for the near term, said Barclays analyst Sudakshina Unnikrishnan. As of 1806, the tin contract traded at $13,775/ton.

In other metals, LME three-month lead snapped back almost 3% as short-term speculators covered short positions after Tuesday's technical breakdown, one broker said. Lead has since clawed its way back to $1,905/ton at 1753 GMT.

In addition, continued supply tightness squeezed three-month nickel up over 3% since Tuesday's kerb, before it fell back to $43,400 at 1756 GMT.

Prices in dollar a metric ton.
3 Months Metal     Bid-Ask        Change from
                                 Tuesday PM kerb
Copper             6659.0-6660.0   Dn 19
Lead               1899.0-1900.0   Up 45
Zinc               3190.0-3200.0   Unch
Aluminium          2743.0-2745.0   Dn  3
Nickel            43350.0-43450.0  Up 557
Tin               13800.0-13810    Dn 790