BEIJING: Shanghai nickel prices slumped nearly 4% on Tuesday, tracking a steep fall in London, as investors chose to book profits after recent gains, while China tin prices hit limit down and dropped to their lowest in almost three years.
Nickel, which is used to make stainless steel and batteries for electric vehicles (EVs), was the standout performer in the base metals complex in the first half of 2019, with a gain of more than 12% in London. But it is now on course to close lower for a third straight session.
"Whilst the EV story appears to be the theme dominating any bullish news flows, elevated stainless stocks and increasing nickel pig iron production mean some specs see (the) short-term rally as overdone," broker Marex Spectron said in a note.
FUNDAMENTALS
* NICKEL: The most traded August nickel contract on the Shanghai Futures Exchange slumped as much as 3.9% to 97,080 yuan ($14,144.59) a tonne, the lowest since June 13, and closed on 97,510 yuan. Three-month nickel on the London Metal Exchange was down 2.3% at $12,070 a tonne as of 0759 GMT, after ending down 2.7% on Monday.
* TIGHTNESS: Nickel's momentum came from "flash", or sudden tightness in SHFE and LME stocks, Citi said in a note. "Both are technical and temporary in our view," it said, adding that: "We do not believe the nickel rally has legs in the near term, based on nickel's own fundamentals."
* COPPER: Three-month LME copper drifted down 0.5% to $5,927.50 a tonne, after ending 0.6% lower on Monday as euphoria over a U.S.-China trade truce gave way to lingering fears over demand. Shanghai copper slipped 1.4% to 46,610 yuan a tonne.
* ALUMINIUM: Shanghai aluminium prices dipped as much as 1.1% to 13,630 yuan a tonne, the lowest since March 27, before recovering to 13,710 yuan at the close. They had hit as high as 14,380 yuan in May.
* TIN: Shanghai tin plunged the maximum permitted 5% to 135,310 yuan a tonne, its lowest since August 2016, while London tin fell as much as 2.8% to $18,365 the lowest since November 2018. "Domestic and foreign tin stocks are high, but demand is relatively low," a China-based tin trader said.
Comments
Comments are closed.