Just when we thought the markets were sitting reasonably stable, we have seen quite a jittery correction on the LME overnight, we also find the Australian dollar has strengthened against the USD, and is currently trading just over 1.04c which is putting added pressure on local prices.
* Copper down USD 226.50
* Aluminium down USD 48.50
* Lead down USD 70.50
* Nickel down USD 550.00
When chatting to traders and buyers overseas yesterday, there seemed to be reluctance to price material at the moment. When traders feel there may be a move south in the market they become more difficult to contact and are slow to respond to phone calls and emails. It seems we may be in for an interesting week in International trade, as we look to the LME to find support at these new levels, before falling further.
**** Copper Faces Downside Risks Near Term – Wing Fung 0157 GMT [Dow Jones] **** By Clementine Wallop @ dowjones.com
The near-term risks for copper prices are to the downside, as investors exercise caution due to concerns over a possible escalation in the euro zone debt crisis and potential for China policy tightening, says Wing Fung Financial Group analyst Mark To. He notes recent investor aversion to many assets considered a proxy for China, including copper, and says this trend may continue near term. “People are not optimistic,” he says, noting that high inflation will be a key concern for China’s policy makers. Three-month copper is trading at $7,620 a metric ton on the London Metal Exchange, down 1.7% from its previous settlement; prices are lower Monday due to fears of Cyprus’ economy and a stronger USD.
**** Just When All Seems Calm, Here Comes Cyprus **** By Kevin Kingsbury @ dowjones.com
Maybe the best that can be said for US stocks amid the Cyprus hand-wringing is things are much better than they were overnight. Dow-industrial futures were down as much as 162 points–though remember, that’s barely 1% at these heightened levels. Surely there’s no shortage of excuses bulls could have used of late to undertake some selling after the 4-month run the market has been on. But there’s also been plenty of folks who hadn’t been buying the rationale for the gains in the first place. So bulls need to hope a slippery slope hasn’t emerged. DJIA futures are down 94 as gold rises roughly 0.5% and Treasury’s rally with safe havens benefiting today. Oil is off 1% and the euro is down at $1.2950.