Nickel Retreats as European Growth Concerns Dim Demand Outlook

Aug 27, 2014 2:29 pm ET

Aug. 27 (Bloomberg) -- Nickel fell the third time in four sessions amid concern that demand will ebb as signs of deepening economic malaise in Europe dim global growth prospects.

German consumer confidence will fall more than economists forecast in September, while French factory confidence dropped in August to the lowest in 13 months, according to reports released today. Chinese consumer sentiment fell in August, a gauge from MNI and Westpac Bank showed.

“The U.S. economy is the largest economy in the world, but it’s no match for combined demand coming from China and Europe, and those aren’t looking particularly rosy,” Bart Melek, head of commodity strategy at TD Securities, said in a telephone interview from Toronto.

Nickel for delivery in three months declined 0.5 percent to settle at $18,850 a metric ton at 5:50 p.m. on the London Metal Exchange. The commodity has climbed 36 percent this year amid concern that an ore-export ban in Indonesia will crimp supplies.

Copper for delivery in three months slipped 0.3 percent to $7,030 a ton ($3.19 a pound) on the LME. Tin also fell, while zinc, lead and aluminum gained.

Aluminum reached an 18-month high yesterday as data showed U.S. durable-goods orders jumped the most on record in July, driven by bookings for aircraft. A standard Boeing Co. 747 jumbo jet contains about 75 tons of aluminum, according to the AluMatter website.

“A very impressive aircraft-order figure in the durable- goods data,” Vicky Sanders, head of analytics sales at Marex Spectron Group in London, said by e-mail yesterday. “That will support the bull case for aluminum.”

In New York, copper futures for delivery in December fell 0.4 percent to $3.1985 a pound on the Comex.

--With assistance from Alex Davis in Hong Kong and Agnieszka Troszkiewicz in London.