Base Metals Fall; Copper Slumps 1.1%

NEW YORK （TheStreet） -- Base metals eased early Wednesday on a rising dollar index as the yields on the 10-year benchmark bond soared 19% after President Obama and his Republican counterparts reached a compromise on proposed tax cuts.

Copper

After a six-day rally, the longest since July, copper for three-month delivery slumped 1.1% to $8,806 per metric tonne on the London Metal Exchange. With investors booking profits following all-time highs, inventories slumped 2,250 tonnes to close at 351,375 tonnes, hitting 52-week lows. The metal faces support at $8,707 and resistance at $9,034.

Southern Copper（SCCO_） closed at $46.55 Tuesday, finding support at $45.97 and resistance at $47.16. Freeport-McMoRan Copper & Gold（FCX_） closed at $110.63, with support and resistance at $109.23 and $113.13, respectively. Teck Resources （TCK_） closed at $55.51, with support at $54.62 and resistance at $57.26.

Aluminum

Aluminum for three-month delivery dipped 1.1% to $2,280 per tone. Inventories accumulated 1,725 tonnes to close at 4.29 million tonnes.The metal faces support and resistance at $2,258 and $2,345, respectively.

Japan, Asia's largest buyer of aluminum, won a cut in premiums charged by suppliers for the fourth consecutive quarter as the fee touched 18-month lows on a slowdown in the economic recovery, Businessweek reports. For the three months ended March 31, premiums were set at $112 per metric tonne, as compared to between $116 and $118 in the current quarter.

Alcoa（AA_） closed at $14.15 Tuesday, finding support and resistance at $14.00 and $14.40, respectively. Century Aluminum（CENX_） closed at $14.99, with support at $14.80 and resistance at $15.36. Kaiser Aluminum（KALU_） closed at $51.16, finding support at $50.81 and resistance at $51.64.

Nickel

Nickel for three-month delivery fell 1.6% to $23,700 per tonne. Inventories added 504 tonnes to 131,412 tonnes. Nickel has support at $23,553 and resistance at $24,153.

Norilsk Nickel is seeking to sell its Waterloo nickel mine as it intends to restart operations at its Lake Johnston asset after a two-year shutdown, Steelguru reports. The Russian mining giant is in talks with investment banks to sell the asset and plans to close the deal in early 2011.

Zinc for three-month delivery eased 2.9% to $2,238 per tonne. Inventories were down 825 tonnes to 632,825 tonnes.The metal faces support and resistance at $2,215 and $2,348, respectively.

Lead

Lead for three-month delivery declined 1.8% to $2,358 per tonne. Inventories decreased 125 tonnes to close at 203,550 tonnes. Support and resistance levels for lead are at $2,333 and $2,441, respectively.