Base metals values continued to benefit from the dollar's demise on Tuesday, tracking oil and gold higher and remaining detached from weakening equities. As we signed off yesterday 3-month aluminium had explored only a narrow range of 2436-2425, with reasonable consumer buying at lower levels sustaining values above 2400 while most of the market remained in Dubai. Later in the premarket they slipped to a low of 2418 in quiet trading, though the pm sessions became more lively as copper set off on a short-covering flurry. The red metal boasted a $300-gain on the day at one point, though aluminium's move was more restrained with much more two-way liquidity being available. The light metal climbed to a pm peak ! of 2465, though systems did record an erroneous bid as high as 2478.75.
The nearby contango stretched fractionally from October onwards, while forward backwardations firmed by 1.00/mth from 2010 onwards.
On Wednesday morning trading resumed near yesterday's highs, changing hands at 2463 as London reopened, though from there values had skidded all the way to 2434 by the end of the premarket. Aluminium's
LME stocks had risen by another 6,000t, while copper was coming off after a Peruvian strike slated for today had been postponed and oil had come off on a production increase agreed by OPEC.
As at last night, trading strategists Cliff Green Consultancy suggested that the market's steady support c. 2400 could now inspire corrective action towards 2500/10. A clear and sustained break above there would signal advances closer to the more important' 2580/90 area, they said, though with studies remaining decisively bearish meanwhile they looked to probe the short side in the days ahead. Last at 2431, Select volumes at 2,000 lots.
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