Nickel advanced for a third day, leading most industrial metals higher, after China cut interest rates for the third time in six months in a bid to boost growth in the largest consumer.
The metal gained as much as 1.5 percent after climbing 2.4 percent in the previous two sessions. The People’s Bank of China reduced the one-year lending rate 0.25 percentage points to 5.1 percent. The move, announced Sunday and effective Monday, came after the nation’s imports and exports both fell in April.
“China’s rate cut could further support sentiment for industrial metals,” analysts including Natalie Rampono at Australia & New Zealand Banking Group Ltd. wrote in a note Monday. “Data showed a pick-up in April Chinese commodity imports on Friday.”
Rules limiting the origin of nickel allowed for delivery in China’s new futures contract prompted speculation prices may extend gains as sellers seek supplies to meet the requirements. The Shanghai Futures Exchange is seeking to allow delivery of foreign-made nickel, including supplies from OAO GMK Norilsk Nickel, the world’s largest producer, the bourse said Friday.
The metal for delivery in three months on the London Metal Exchange climbed 1.2 percent to $14,475 a metric ton at 3:01 p.m. in Hong Kong, advancing for a third day, while the contract for July gained 1.4 percent in Shanghai to settle at 113,880 yuan ($18,341) a ton.
Copper in London traded little changed at $6,389.50 a ton ($2.90 a pound). In New York, July futures slid 0.3 percent to $2.911 a pound, while the metal for the same month in Shanghai slipped 0.4 percent to close at 45,790 yuan ($7,375) a ton.
Copper entered a bull market last week and rose to the highest since December amid speculation China’s policy makers would add stimulus and on signs that supply is tightening. Money managers raised their net-long copper positions to 31,645 futures and options on the Comex, the most in nine months, U.S. Commodity Futures Trading Commission data released Friday showed.
Also on the LME, aluminum, zinc, lead and tin rose.