Monday, 22 November 2010

LME LATEST - Metals slide back in rings as sentiment softens, euro loses ground

- Base metals were largely on the defensive during the open-outcry sessions on Monday, as the early upbeat mood gave way to increased caution, and with the euro losing some its initial steadiness prices in the complex drifted lower.

- The euro, which had been around its highest for a week or so at 1.3786 against the dollar, fell away to 1.3665 recently as the knee-jerk uptick to Ireland's proposed financial bail-out petered out and worries over sovereign debt contagion remained. Share markets, which were steadier earlier, also eased, with European equities around 0.3 percent lower at midday.

 - Copper, above $8,500 in Asia, retreated near to $8,360 before settling at $8,369 per tonne, a $35 loss from Friday. Aluminium, in contrast, held at $2,290, still up $26.

 - But zinc dropped to $2,151, a $9 loss, while lead eased back to $2,250, a $27 decline. Nickel business at $21,759 was down from a previous $21,850.


European stocks coming off morning highs due to Irish rescue package




FXstreet.com (Barcelona) - Equities over the European continent benefited early from the weekend news that Ireland had finally formally applied for EU/IMF funds in order to stave off default. The initial wave of optimism has somewhat worn off however by mid-day, with the FTSE 100 hanging around even while the DAX and CAC 40 post gains of 0.31% and 0.05% respectively.

The late Sunday announcement that Ireland had succumbed to EU pressure to accept bailout funds gave investors reason to celebrate on Monday morning, however with details still to be clarified there remains some slight uncertainty lingering in the marketplace. The question now is whether other periphery nations like Portugal and Spain will be next in line, or stability in the community can be re-established.

In the London market, resource firms are some of the best performers so far with Vedanta Resources up nearly 2.0% while Xstrata gains by 0.50%. The financial sector on the other hand remains in the negative due to exposure to Irish debt, with the Royal Bank of Scotland down nearly 3.0%, while Lloyds Banking Group drops nearly 2.0%.

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