SPOTLIGHT: Copper backwardations here to stay; warrant cancellations rocket
Apr 25, 2012 | 09:16 AM
|
The backwardations across the copper spreads on the London Metal Exchange are likely to remain in place for the foreseeable future, according to traders, meaning that market participants must grapple with a new trading environment at least for the time being.
The red metal settled at a three-month price of $8,200/05 per tonne on Wednesday April 25, as short covering began to take hold on the market. Prices had slipped below $8,000 per tonne earlier in the week and had threatened to fall further.
A number of market participants have now said they believe the short covering is coming from China, as their positions are squeezed.
“We’ve seen so much two-way business out of China today that it’s difficult to see who has been squeezed and who hasn’t. I’ve no doubt that [Chinese shorts] are a part of the game,” an LME broker said.
“There’s liquidity and that’s helpful.....
To access AMM's full content, please log in below. If you do not have an AMM account, we invite you to take a free trial or subscribe below.
Already a registered amm.com user?
Access to amm.com editorial content is granted only to paid subscribers and trialists. If you do not have an active account in your own name, please either subscribe or take a trial and you will have instant access to amm.com content. Sharing your login credentials with individuals who are not subscribers represents a violation of AMM copyright.
Every morning, every minute — no matter how often you follow the markets, there's an AMM subscription to fit your needs.
Subscribe Now
Click Here
Not sure if you are ready to invest in a subscription right now? Take a free, no-obligation trial. Start your free trial today.
Take a Free trial
Click Here