SINGAPORE- Shanghai nickel rallied more than 3 percent and London nickel advanced on Thursday, as investors who bet on falling prices had to buy in at a strong support level.
Nickel prices have fallen in the past weeks to touch a five-month low of $12,900 a ton on the London Metal Exchange (LME) on Tuesday, as the market viewed prices more expensive than supply and demand fundamentals indicated.
“$13,000 was a critical number to defend,” said a trader.
Three-month nickel on the LME on Thursday climbed as much as 0.9 percent to $13,980 a ton, while the most-traded nickel contract on the Shanghai Futures Exchange (ShFE) jumped as high as 3.5 percent to 110,570 yuan ($15,708.42) a ton, nearing a two-week high.
Other nickel industry players said prices have dropped low enough and a rebound is expected, noting that a royalty hike in top nickel ore producer Indonesia contributed to a bullish view on prices. – Reuters