LME Metals Mostly Flat In Asia;Await China Data

SINGAPORE--Base metals on the London Metal Exchange opened the week on a sluggish note in Asia Monday, as market players waited for fresh factors to provide direction, traders and analysts said.

Absent any new supply-side news or economic data, the complex may trend lower to form a base, despite the complex's mild rebound in London Friday and a weaker dollar, they said.

Three-month copper edged $15 lower from the London Friday afternoon kerb to $7,875 a metric ton as of 0600 GMT. Aluminum was unchanged at $2,875/ton, as was zinc at $4,045/ton.

"I think people are waiting for the import-export figures to come out for China," said a Tokyo-based trader at a Japanese commodity brokerage. "If the (copper) import figures are lower, as most people expect, we could see more selling, maybe even short selling."

Preliminary data for China's imports and exports are expected to be released sometime this week, according to customs.

Traders said the large jump in copper stocks at the Shanghai Futures Exchange on Friday continued to weigh on SHFE copper futures Monday, but its impact on LME has already been priced in the market.

However, analysts said LME copper's technicals are biased to the downside at the moment as it consolidates, though this could provide fresh long-buying opportunities for the medium-term bull trend.

"(The) primary view remains positive for copper, and weakness towards $7,590 is regarded as an opportunity to reestablish long positions," Standard Bank said in a daily report.

Aluminum was mostly flat in thin trading conditions, with just 24 lots on LME Select. Its retreat from $2,900 at the end of last week has returned it to its previous seven-month trading range, although options activity on the June expiry remains a potential source of volatility, traders said.

"The market's seen these numbers so many times, so why trade unless you have to?" said the Tokyo-based trader.

Nickel was untraded in Asia. Despite its gains Friday and its low stock levels, an increasingly bearish outlook for Europe's stainless steel industry could begin to weigh on the price, said BNP Paribas' David Thurtell in a daily note. "With stainless steel prices on the decline it may be difficult for nickel to hold above $50,000 in spite of critical stock levels."

In its weekly commodities report, Macquarie Research said a rebound in the OECD's composite leading indicator for March was a bullish sign for base metals.

Led by stronger industrial productivity in the U.S., the data suggest the slowdown in OECD countries may come to an end in the third quarter, Macquarie said.

Added to the robust performance of China and the other five main non-OECD countries in March, the data "can only be characterized as a bullish development for metals demand going forward."

As of 0600 GMT, lead was untraded and last quoted at $2,085.15/ton, up 15 cents from the kerb; tin was also untraded and was last quoted at $14,050/ton.