Nickel continued to hit record prices on the London Metal Exchange Friday amid gains across the complex following a weakening in the dollar, traders and analysts said.
Falling stocks, an ongoing strike in New Caledonia affecting Eramet SA's nickel production and the dollar conspired to push nickel to an all-time high of $33,500 a metric ton, up 3.4% on the Thursday PM kerb.
The dollar's plunge to the lowest level since April 2005 helped metals across the board, pushing LME copper prices to a two-week high of $7,185/ton, up 2.9% and through resistance at $7,100/ton to trigger systematic buying.
Rising LME stock levels remain a concern but a sizable decline in Shanghai Futures Exchange copper stocks of 4,435 tons to 27,141 tons helped market sentiment, traders said.
Thin holiday trade conditions prevailed with most U.S. traders away from their desks for the long Thanksgiving weekend.
In the nickel market, LME stocks fell by 126 tons to 6,354 tons, a level that is still critically low, Barclays Capital said.
Production losses of 50 tons per day at Eramet's operations overhang the market alongside market talk of output problems at Inco Ltd.'s operations in Canada in the fourth quarter, Jim Lennon at Macquarie Bank said.
A breach of the last contract high also triggered technical buying and spreads firmed slightly, with the cash-to-three month backwardation moving to $850/ton from $800 Thursday.
LME zinc also fared well, rising to $4,545/ton, close to its earlier November record high of $4,580/ton.
3 months metal (prices in dollars a ton)
Bid – Ask, Change from Thursday PM kerb
Copper 7150.00-7155.00 Up 170.00
Lead 1573.00-1574.00 Up 24.00
Zinc 4509.00-4510.00 Up 59.00
Aluminium 2718.00-2719.00 Up 31.00
Nickel 33450.00-33500.00 Up 1050.00
Tin 10045.00-10050.00 Up 55.00
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