Aluminum Prices Lower In Asia On News That Alcoa Averts Strike June 01, 2006
SINGAPORE (Dow Jones)--London Metal Exchange aluminum reversed most of its
gains made in early Asian trade Thursday on reports that Alcoa Inc. (AA) and
the United Steelworkers union had averted a strike with a tentative contract

  Three-month aluminum reached as high as $2,685 a metric ton but began inching
lower when the Alcoa news was out. By 0400 GMT, aluminum was at $2,660/ton, up
just $10 on the London PM kerb.

  But unlike nickel prices, which slumped Tuesday after news broke that a
strike by workers at Inco Ltd. (N) had been averted, aluminum prices may not
have far to fall.

  "Aluminum prices went up in anticipation of a strike, but much of the earlier
gains have already been given up in the recent broad-based commodities selloff,
so in that sense, aluminum doesn't have that much to lose," said a
Singapore-based trader.

  At 0400 GMT, LME three-month nickel was trading $100 lower at $21,800/ton,
off the record $23,000/ton hit Friday.

  The rest of the LME base metals mostly drifted in quiet trading, despite
earlier expectations that an extension of LME's electronic trading hours will
increase volumes in Asia.

  "Liquidity is largely absent because the market has been very volatile
lately, so many players are still sitting it out. One of the main reasons for
the extension is to increase volumes but that's not happening right now," said
a Shanghai-based trader.

  At 0400 GMT, flagship three-month copper was trading down $55 at $7,845/ton,
while zinc was off $45 at $3,625/ton.

  The LME confirmed that its electronic trading platform, LME Select, will open
six hours earlier from Thursday, said the exchange in a note overnight.

  The new trading times are 0100 to 1900 London time to cover Asian trading

  Member firms will now be able to access LME Select from Singapore, Japan and
China. The Exchange is currently in the process of applying for authorization
from Australia and Hong Kong, the note said.

  Investors in China, the world's biggest consumer of many metals, were more
interested in chasing their own domestic market, said local participants.

  Shanghai copper futures opened sharply lower Thursday and ended the morning
in negative territory, following overnight declines in LME copper.

  Shanghai's benchmark August copper fell CNY3,380 to CNY70,500/ton midday.
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