Copper up as dollar eases, lead jumps 11 pct

Tag : lead,copper
United Kingdom - * Copper up 1 percent as dollar retreats from 2008 highs
* Lead hits three-week high at $2,060/t as inventories fall
* Zinc and nickel firms in technical rebound
(Updates prices to London close, recasts)
By Julie Crust and Anna Stablum
LONDON, Aug 27 (Reuters) - Copper rose on Wednesday as the dollarsoftened and lead rose more than 10 percent on a technical rebound."The whole commodity complex is higher and the dollar is a bitweaker -- so it is just a reaction of the oversold situation inlead," said analyst Eugen Weinberg at Commerzbank.
London Metal Exchange lead rose 11.1 percent to a high of $2,060 --the highest since Aug. 8 -- before closing at $2,050. On Tuesdaylead, used in batteries, was at $1,855.
Prices have fallen by 15 percent this month as the European summeris a traditionally soft period for metals demand.
Copper for delivery in three months rose 0.9 percent to$7,650/7,655 per tonne from $7,580 on Tuesday as a softer U.S.currency makes dollar-priced metals cheaper for other currencyholders.
The dollar slipped as investors bet the U.S. currency's recent jumpto 2008 highs against a basket of currencies was too far and toofast.
Lead stocks in LME warehouses fell 3,050 tonnes to 83,375 -- thelowest level since June 13.
Since July there has been strong demand for lead in Singapore withmetal going to China, which has become a net importer of refinedlead for the first time since 2004.
"The imports from China are picking up," Weinberg said.
"There have been several announcements of production cuts for bothlead and zinc and demand is not as bad as we expected."
Zinc gained 3.4 percent to a high of $1,850 before closing at$1,849. LME stocks fell 1,300 tonnes to 161,225. On Tuesday, themetal, mainly used to galvanise steel, closed at $1,790, afterfalling more than 2 percent.
The metals were seen finding a floor with zinc prices falling by 24percent this year and lead is down 20 percent.
"The situation is positive for lead and zinc, both areenergy-intensive metals and production costs are high," Weinbergsaid.
Also nickel bounced after being oversold, down over 20 percent thisyear as demand from stainless steel producers, using nickel fordurability, have fallen behind expectations.
Nickel was last at $21,000, up 4.8 percent, versus $20,030 onTuesday.

COPPER SEEN PICKING UP
Traders in Shanghai said they had seen new material coming into thephysical market, dragging down spot prices, and there was talk of"tens of thousands" of tonnes of copper arriving.
"A replenishment would not necessarily be bearish as stocks inShanghai are critically low at the moment," Nick Moore, commoditystrategist at Royal Bank of Scotland (nyse: RBS - news - people ), said.
Shanghai exchange warehouse stocks, at 21,796 tonnes last week, orabout two days of Chinese daily consumption, are tight, despiterising inventories in LME warehouses.
LME copper stocks, used in construction and power cables, rose 950tonnes to 167,850, the highest level since Feb. 6.
Moore said copper stocks tend to increase in August, but followingthe end of the Olympic Games the market would look forward to aseasonal bounce in the fourth quarter.
Miner Antofagasta said it expected fundamentals for the coppermarket to remain sound with prices remaining strong well into 2009,despite a softening of prices in the seasonally weaker thirdquarter.
Aluminium closed at $2,765 a tonne from $2,768 as rising oil pricesput pressure on the energy-intensive metal, even as inventories ofthe metal declined.
Stocks fell 2,200 tonnes to 1.16 million tonnes, but are stillclose to their highest levels since April 2004.
Tin was under pressure from profit-taking after being the best LMEmetals performer this year gaining 25 percent.
It closed at $20,550 from $20,700 on Tuesday.

Metal Prices at 1602 GMT Metal Last Change Percent Move End 2007Ytd Percent
move LME Cu 7655.00 75.00 +0.99 6670.00 14.77 SHFE Cu* 59500.00420.00 +0.71 56880.00 4.61 LME Alum 2765.00 -3.00 -0.11 2403.0015.06 SHFE Alu* 18030.00 55.00 +0.31 18180.00 -0.83 COMEX Cu**353.45 5.60 +1.61 303.50 16.46 LME Zinc 1835.00 45.00 +2.51 2370.00-22.57 SHFE Zinc* 14335.00 220.00 +1.56 18950.00 -24.35 LME Nick20725.00 695.00 +3.47 26350.00 -21.35 LME Lead 2045.00 190.00+10.24 2550.00 -19.80 LME Tin 20450.00 -250.00 -1.21 16400.00 24.70** 1st contract month for COMEX copper * 3rd contact month for SHFEAL, CU and ZN SHFE ZN began trading on 26/3/07
(Reporting by Julie Crust; editing by Christopher Johnson) Copyright 2008 Reuters, Click for Restriction