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Metals cap a week of superlatives as zinc leaps to 10-year high
[LONDON] The story of metal markets this week reads like a laundry list of achievements.
Zinc crashed through the US$3,000 barrier for the first time in a decade.
Copper and aluminium reached three-year highs in London.
Lead's weekly gain is the biggest since June.
Driving the gains was a combination of data showing faster economic growth, a weaker US dollar and shrinking supply. Chinese capacity curbs have boosted aluminium, while stockpiles of zinc tracked by the London Metal Exchange have slumped to the lowest level since 2008.
"Such spectacular rallies across the board," said Malcolm Freeman, a director of West Malling, England-based brokerage Kingdom Futures. "What a week and it has not finished yet."
Zinc was the star of the week as prices jumped 7.5 per cent to US$3,114.50 a metric ton. For the year, it's up 21 per cent, rivaling aluminium as the top-performing LME metal for 2017.
Pit suspensions by companies including Glencore Plc and environmental checks in China are constraining supply just as global demand recovers. Data this week showed China's daily production in July contracted to the lowest level in three years.
"A tight refined zinc market has long been anticipated," Credit Suisse Group AG said in a note to investors Friday. "On our estimates, the contraction in mine production has led to a multiyear deficit in the market."
Copper prices are little changed at US$6,488.50 a ton on Friday. For the week, prices are up 1.2 per cent.