Copper gains

Copper prices rose on Friday along with the euro and global shares, bringing the total gain for the week to more than 2 percent as the metal recovers from a three-month low hit earlier this week. Three-month copper on the London Metal Exchange ended at $8,190 a tonne, up 1.8 percent from a close of $8,050 on Thursday. The metal used in power and construction has rebounded from a three-month low of $7,885.25 on Monday.
The euro climbed to a two-week high against the US dollar on Friday as investors took on more risk after a better-than-expected German business sentiment survey and comments that the G20 would pledge to increase the IMF's resources by more than $400 billion.
Copper is up 2.5 percent so far this week, in its biggest weekly gain since late February. But analysts warned that gains could be short-lived as concerns about the outlook for the economy and demand continue to weigh on the market.
"The Spanish issue is still a big concern to the market. And demand from China has been very slow, so I wouldn't get too excited about the upside (for base metals)," Edward Meir, an analyst at INTL FCStone, said. Open interest in copper on the LME fell to its lowest level in more than two years, suggesting a lack of conviction in the market.
"Over the short term, downside room will most likely be determined by the euro zone crisis, which continues to ferment and hurt sentiment," said a Shanghai-based trader.
Also weighing on copper, high LME cash prices are spurring Chinese firms to re-export their stocks in bonded warehouses in Shanghai, boosting supplies for nearby delivery at LME warehouses and helping to ease backwardation. The benchmark cash-to-three-months backwardation - the premium for cash copper against three-month delivery on the world's biggest metal marketplace - reached $114 per tonne on Tuesday, a level not seen since 2008.
The premium eased to $55.15 on Friday. The latest LME data showed copper stocks rose by 1,550 tonnes to 262,700, cementing a steady rise since late March, while official Shanghai data showed copper inventories fell 4.8 percent from last Friday, but remained near multi-year highs.
Goldman Sachs estimated in a recent note that unofficial Shanghai bonded stocks were at around 620,000 tonnes. On a brighter note, Freeport-McMoRan Chief Executive Richard Adkerson said on Thursday fundamentals of the copper market remained strong, given China's drive to invest in infrastructure projects and lower levels of inventory in the United States and Europe.
In other metals, stainless-steel ingredient nickel ended at $17,805 from Thursday's close of $17,600. Nickel production in BHP Billiton's Cerro Matoso mine in Colombia rose 72 percent in the first quarter from the year earlier due to the replacement of a furnace, the company said. Zinc, used in galvanising, ended at $2,026 from $2,000, while battery material lead was at $2,125.50 from $2,080. Aluminium was at $2,084 from $2,073.
Soldering metal tin was untraded at the close, but bid at $21,500 from Thursday's close of $21,375. Refined tin output at PT Timah, Indonesia's largest tin miner, was forecast to rise by as much as 18 percent this year, an official at the company said on Thursday.