Base metals steadied in pre-market London Metal Exchange (LME) trading but dealers said that the upside was likely to be capped by scale-up selling in thin volumes.
More activity was expected in the rings but copper and aluminium both needed to see strong sustained buying to get them through heavy overhead selling. Everyones testing it higher just to see whats out there, said a trader. The vote in the Russian Duma on whether to accept president Boris Yeltsins choice of prime minister, Sergei Kiriyenko, was likely to impact on aluminium, nickel and copper.
A result was expected soon during the first morning rings, and a rejection of Kiriyenko could be taken as a sign that Russian metal supplies would be delayed, traders said.
Copper rose $14 to $1,895 by 0949 GMT, a $14 increase on Thursdays kerb close, and was seen encountering heavy selling at $1,900.
Analysts said they expected a downward correction to precede any attempt at upside chart targets of $1,920 and $1,950. Copper stocks were supportive initially, falling by 6,175 tonnes to a total of 277,350.
This takes the weeks total fall to 27,625 tonnes, a nine per cent change.
Aluminium steadied above $1,480 but traders said that it had been marked up persistently in thin volumes, only to be hit by heavy selling, including producers placing material forward, at $1,482/83.
Fund short covering and other patchy trade pushed the market $5 higher to $1,480. It might test $1,485 but theres got to be a lot of buying to get that through, said a trader. Its all speculative buying. If it fails to go higher, it will fail miserably, said another.
Asian aluminium premiums were steady despite very high stock levels, traders in Asia said. Nickel firmed $75 to $5,615, giving a bullish sign to traders as it shook off the recent range.
Tin was $25 higher at $5,720 as the cash/threes backwardation held steady at $99/109.
Traders said that large players continued to dominate and hold the spreads tight. Zinc firmed to $1,133 while lead stagnated at $580. Alloy firmed $6 to $1,341.
