All base metals on London Metal Exchange ended sharply up Wednesday due to fall in dollar against the euro and rise in US factory orders in June, analysts said. Benchmark three-month copper futures hit a fresh 10-month high, while nickel contracts gained the most, rising to a new 11-month high. LME base metals index closed at 2984.6 on Wednesday, up 94.7 points.
Weakness in dollar against the euro pushes up base metal prices as it makes investment in dollar-denominated commodities more lucrative for holders of other currencies. The rally in base metals was mainly led by nickel, which jumped 5.7% on supply concerns due to the ongoing strike at Vale's Sudbury mine operations in Canada, analysts said.
China and the US are the world's largest metal consuming nations. Base metals complex also rose on speculative buying, triggered by concerns that the world metal market may face supply deficit by the end of 2009, said a Mumbai-based analyst.
