With prices of metals low, there is an expectation that Chinese buyers will enter the market in September to pick up bargains and fill inventories.
However, the fragile state of the global economy could keep prices down. Gold continues to rise – an indication that investors continue to seek a safe haven. Gold for December delivery in New York reached a record $1881.90 on early trading today.
Oil has also fallen following the likely overthrow of Colonel Gaddafi in Libya. Investors believe more oil will eventually be released onto the market as a result. Libya produced only 100,000 barrels a month in July, compared to the 1.59 million in produced in January. As a result, in early trading Brent crude futures fell to $106.8 per barrel while US sweet, light crude was at $82.9 per barrel.
In early trading today, copper was up to $8,890 a tonne on news that Shaghai stockpiles of the metal fell for the first time in six weeks. Chinese buyers are expected to take advantage of the currently low prices and return to the market. But the effects of this could be limited.
Xinhu Futures Co analyst Lian Zheng said: “The expectation of increasing Chinese demand in September is competing with a generally negative market environment due to concerns over the European debt crisis and the US economy.”
On Friday, copper settled at $8,805 (£5,329) from $8,828 (£5,343) on Thursday.
Aluminium was down to $2,345 (£1,419) from Thursday’s $2,404 (£1,455). Alloy was priced at $2,250 (£1,362) on Friday from $2,270 (£1,374) the day before.
Lead was at $2,319 (£1,404) from $2,332 (£1,411) on Thursday. Nickel finished the week at $21,505 (£13,016) down from $21,575 (£13,058) on Thursday.
Tin on Friday was priced at $23,200 (£14,042) down from Thursday’s $23,895 (£14,463). Zinc was at $2,190 (£1,326) up slightly on the $2,185 (£1,322) seen on Thursday.
Steel remained at $560 (£339).