Metals Rally With Miners as Confidence Improves on ECB Stimulus

  • Copper, lead and zinc climb more than 1 percent in London
  • LME copper inventories head for weekly decline since 2014

Industrial metals and mining stocks rallied as investor optimism spread across global markets in the wake of the European Central Bank’s announcement that it plans more economic stimulus.

Copper, zinc and lead paced gains in London, climbing at least 1 percent. Equities and crude oil advanced as investors embraced the ECB measures announced by President Mario Draghi on Thursday. Metal prices also got a boost after China strengthened the yuan’s fixing by the most in four months.

Global markets retreated Thursday as investors looked past an unprecedented boost to European monetary policy, focusing on rising anxiety that policy makers had lost the ability to jump-start global growth and stave off deflation.

“These statements have little nuances here and there, and sometimes you have to read them 43 times before you get whats really being said,” Bill O’Neill, a partner at Logic Advisors in Upper Saddle River, New Jersey, said in a telephone interview. “Draghi didn’t rule out additional accommodation, and that also creates some indication the European economy may not be as bad as people think it is, and that spilled into the copper market.”

Copper for delivery in three months climbed 1.6 percent to settle at $4,970 a metric ton at 5:50 p.m. on the London Metal Exchange. Lead, nickel, tin, zinc and aluminum also gained. In New York, copper futures for May delivery advanced on the Comex.

  • Copper inventories tracked by the LME fell 5.7 percent this week, the biggest such decline since May 2014.

  • The FTSE 350 Mining Index rose 2.4 percent on Friday, with Vedanta Resources Plc and BHP Billiton Plc leading gains.
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