LIVE FUTURES REPORT 19/07: LME nickel price softens amid moderate turnover; copper rallies above $6,000/t

Nickel’s three-month price on the London Metal Exchange was lower during morning trading on Friday June 19, with the metal’s weeklong price rally cooling across Asian trading hours.

Nickel futures were recently seen trading around $14,745 per tonne, with volume traded lower than in recent days at some 3,900 lots exchanged as of 9.00am London time.

Price action in nickel had surpassed $15,000 per tonne on Thursday, its highest level since sanction concerns caused the metal’s price to spike to a high of $16,690 per tonne in April.

“As expected the nickel market was the main performer yesterday as it eventually ran up to $15,120 per tonne and with a volume of over 20,000 lots traded,” Kingdom Futures director and chief executive Malcolm Freeman said in a morning note.

“Looking at the open interest in LME options, with the exception of a few small positions around $16,000 per tonne and above, the market has run up past all the major open positions in call options so the requirement to buy against open short call options has become pretty much hedged,” he added.

Meanwhile, copper’s three-month price was higher over the morning trading session, breaching the nearby $6,000-per-tonne resistance level, with 11,370 lots traded during the morning session.

The red metal climbed by some 2% overnight from a low of $5,987.50 per tonne to $6,118 per tonne on Friday morning, reaching its highest level since May.

In macroeconomic news, market participants continue to speculate against fraught US-China trade relations amid a fresh bout of tariff threats from US president Donald Trump this week totaling $325 billion. The two countries are reportedly continuing to engage in discussions regarding a possible trade deal.

Other highlights

  • The dollar index was higher over the morning, up by 0.03% at 96.93.
  • In other commodities, Brent crude oil futures were trading 0.27% higher over the morning, recently at $62.68 per barrel.
  • In European data this morning, the German producer price index (PPI) figure for the June-July period was down by 0.4%, surpassing the expected drop of 0.1%.
  • Meanwhile, the European Union’s current account for the same period was recorded at a surplus of €29.7 billion ($33.4 billion), beating an expected level of €21.2 billion and up from €22.4 billion the prior month.
  • Later, the United Kingdom will release figures on its public sector net borrowing, with expectations currently set at £3.4 billion.
  • Additionally, the United States will be releasing preliminary University of Michigan consumer sentiment and inflation figures, while Federal Open Market Committee members James Bullard and Eric Rosengren are scheduled to speak.

Hassan Butt

hassan.butt@fastmarkets.com

Consuelo de la Jara

Published

Hassan Butt

Consuelo de la Jara

July 19, 2019

10:21 GMT

London