Base metals on the London Metal Exchange were predominantly higher during morning trading on Wednesday January 16, with a slight downturn in the US dollar index providing legroom for upward price action while nickel futures continue to gain traction.
Despite being the only metal to trade in negative territory over the morning, nickel's three-month price remains elevated, trading at an intraday high of $11,770 per tonne. Nickel's LME stocks remain on a downtrend notwithstanding a fresh inflow of more than 3,000 tonnes this morning, while tightness in the metal's forward curve has emerged, with its cash-February spread currently in a backwardation of $10 per tonne.The metal's cash/three-month spread was recently seen in a contango of $9 per tonne, narrowing from a $93 per tonne contango on January 2."As a general theme the metals remain somewhat 'cheap' as an asset class and the more stimulus and positivity in the macro the steadier and more consistent the onshore bid will become which is the key determinant of where these metals go," Marex Spectron's head of institutional sales, Matt France, said in a morning report."There is still plenty of macro risk...