LEAD AND TIN STAND OUT
Lead ended the morning ring at $3,241 a tonne, up $111, or 3.5 percent. It jumped over five percent at one stage on technically-motivated fund buying to hit its best since July 25, at $3,300. "Lead followed its own trading pattern today, and in the absence of any direct lead news, the price was propelled higher by fund buying," broker Sucden said. Another inventory decline -- LME stocks fell 300 tonnes to 36,750 tonnes today, the lowest for 3-1/2 months -- underlined the market's tight supply picture. Prices now look set to re-test the $3,500 all-time high hit on July 20. Since that time there has been a 17 percent correction back to $2,900, but the steeper re-tracement has not taken place. As well as fundamental tightness -- 2007 has seen major supply disruptions in Australia and the UK -- technical strength and speculative involvment are evident now. "While we will not discount the bullish news that would appear supportive of lead prices -- lack of Chinese exports, new Chinese export taxes, falling LME stocks, rising battery demand, continuing problems at that Esperance port in Australia, and strikes at mines in Mexico and Namibia --, we cannot help but think there is still a rather large speculative premium built into the lead price," a trader said. Similarly, short-covering for players that wrongly opted to go short in recent days supported tin, with prices ending the ring 3.2 percent, or $500 higher at $16,250 a tonne. This metal continues to pay little heed to its worsening fundamentals -- supply from Indonesia is improving and LME stocks are rising, reaching 13,910 tonnes today, the highest since May 5, 2006.
