Copper gains as China agrees to roll back tariffs on some US goods

• Copper firmed on Friday, heading for its third straight week of gains after China said it would waive import tariffs.
• The signals of progress towards a trade deal between Washington and Beijing injected fresh optimism.
• The talks were "moving right along", President Trump said on Thursday, even as Chinese officials insisted.

The signals of progress towards a trade deal between Washington and Beijing injected fresh optimism on hopes for an end to the months-long dispute.

"This week there was some good progress made on the trade front, but the risk remains high," said WisdomTree commodity strategist Nitesh Shah.

Developments in the US-China negotiations have sent mixed signals to markets, leading metals such as copper to trade in narrow ranges as traders await more concrete progress.

Benchmark copper on the London Metals Exchange (LME) added 0.3% to $5,901 a tonne by 1135 GMT, with the metal used in power and construction on track for a 0.7% weekly gain.

POSITIONING: Broker Marex Spectron estimates net speculative long positions in Comex copper at 1.9% of open interest, or 3,900 lots. Positioning has ranged this year from a long of 52,000 lots in March to a short of 36,000 lots in May, Marex said in a note.

TRADE WAR: The talks were "moving right along", President Trump said on Thursday, even as Chinese officials insisted that both sides must cancel some tariffs to clinch a phase one deal.

On Friday China waived some of the 25% tariffs imposed on both US soybeans and pork in July 2018 in repsonse to tariffs levied by Washington.

GERMAN DATA: Germany's industrial output dropped unexpectedly in October, reviving worries about its economic growth outlook in the face of global trade conflicts and disruptions in the auto sector.

INVENTORIES: On-warrant levels of LME copper were down 200 tonnes at 113,400 tonnes, the lowest since March 14.

COPPER SPREADS: The discount of LME cash copper to the three-month contract was at $29 a tonne, its highest in nearly two months.

NICKEL: Indonesia expects to have total annual nickel capacity of nearly 70 million tonnes by 2022, compared with a November projection of 91 million tonnes in 2021.