Zinc climbed to a four-week high amid signs of tighter global supplies and faster-than-expected economic growth in China, the world’s biggest user. Lead rose to the highest in more than a month.
Refined-zinc production of 1.18 million metric tons lagged behind demand of 1.22 million tons in May, the International Lead and Zinc Study Group said in a statement. China’s economy expanded 7 percent in the second quarter, unchanged from the first quarter and beating the 6.8 percent estimated by economists, data showed Wednesday. The country’s industrial output rose 6.8 percent in June from a year earlier.
Chinese policy makers introduced measures to stem a rout that erased almost $4 trillion from the value of the nation’s equities in less than a month. Growth concerns pushed the London Metal Exchange’s index of main metals to a six-year low last week. The gauge has since rebounded 4.7 percent.
“The fundamentals for zinc continue to be pretty decent, and ultimately it will be a decent performer of the base metals peer group,” Bart Melek, the head of commodity strategy at TD Securities in Toronto, said in a telephone interview. “Lead and zinc sold off quite a bit during the whole China and Greece uncertainty. Metals with strong fundamentals should do pretty well.”
Zinc for three-month delivery rose 1.1 percent to settle at $2,077.50 a ton at 5:51 p.m. on the London Metal Exchange, after touching $2,117.50, the highest since June 16. Lead advanced to the highest since June 11.
Aluminum rose, while copper, tin and nickel dropped. In New York, copper futures for September delivery on the Comex fell 0.5 percent to $2.5215
Demand for copper will be supported by Chinese stimulus measures and increased power-grid spending and cable production, Barclays Plc analysts including Suki Cooper said in a report Tuesday.