Base metals subdued; Aluminium went slightly up

 

Essentially lower levels

Base metals prices started a holiday-shortened week mostly on the defensive. With LME premarket trading on Tuesday April 18 seeing lower levels. – Potentially supportive macroeconomic developments were shrugged off.

The exception was aluminium. It pushed higher on weekend news that planned Chinese capacity extensions were being put on ice.

On the other hand, copper and zinc were wafting. Near last week’s three-month lows, nickel touched its softest for two-and-a-half months. Lead hit its weakest for two months.

“Sentiment was a bit sloppy last week, and that has carried over today it seems. There is a run of short weeks now so business looks like being a bit patchy at times.”

Consequently, there was a muted reaction to Monday’s upbeat Chinese data! First quarter GDP grew 6.9% year-on-year, marking the fastest growth rate in 18 months. And most noteworthy beating forecasts of 6.8%

 

Metals session except Al

 

The rest of the session may see the lackluster trend being maintained ahead of a string of metals.

“The base metals have been showing weakness in recent weeks and have so far not seen any pick-up even amid the shift into the seasonally strong second quarter. The lack of upside momentum in most of the metals since mid-February has increased the chance of stale long liquidation,” William Adams of Metal Bulletin said.

 

 

Aluminium

Aluminium goes it alone; China supply clenching?

The three-month aluminium price forged higher, recently trading at $1,928 per tonne, up $18 from the Thursday close. The local government in Xinjiang, western China, halted three new aluminium projects with combined capacity of 2 million tons per year for violating rules aimed at curbing output.

 

 

Other near multi-month lows

 

The three-month copper price slid to $5,663 per tonne, a $29 decline, and looks vulnerable to a test of last week’s $5,615 low. While three-month zinc price was at $2,593 per tonne, a $31 loss, with a test of $2,558 – last week’s low-point – possible. Also, three-month lead price skidded as low as $2,200 per tonne, a $39 loss, while nickel fell to $9,560, down $190. Most noteworthy, three-month tin price stood at $19,795 per tonne, however, a $190 advance.

 

Currency moves and data releases

 

The dollar index was recently down 0.29 at 100.29.

Brent crude oil fell $0.61 to $55.00 per barrel.

In equities, the UK FTSE 100 index fell nearly 70 points to around 7,258.

In data today, US building permits, housing starts, the capacity utilisation rate and industrial production are due.

 

Crude Oil Update

Venezuela’s crude-stained oil tankers banned at sea (*check the link below)

http://www.reuters.com/article/us-venezuela-oil-tankers-insight-idUSKBN17K0CE

  • June West Texas Intermediate crude oil futures are trading lower shortly before the regular session opening as investors react to a bearish government report.

Government data released on Monday showed that May output is expected to rise by 123,000 barrels per day to 5.19 million bpd.

If this information is right, May production will post its biggest monthly increase since February 2015 and the highest monthly production level since November 2015.

Overcoming the angle at $53.08 will indicate the return of buyers. This could create a labored rally into angles at $53.39, $53.77 and $53.95. Other is the last potential resistance angle before the $54.14 main top.

OPEC commented on its plans about extending to cut productio . But it may not be strong enough to turn this market around.

 

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