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Copper and Zinc Rise as China Inflation Eases Tightening Concern

Copper and zinc rose for a second day in London, pacing gains by industrial metals after weaker- than-estimated Chinese inflation eased concerns about tightening of monetary policy in the country.

Consumer prices increased 2.1 percent in March from a year earlier, China’s statistics bureau said today, below the 2.5 percent median estimate of analysts surveyed by Bloomberg News. The nation is the world’s biggest user of industrial metals. Prices also climbed after aluminum producer Alcoa Inc.’s first- quarter earnings exceeded analysts’ estimates. Copper for delivery in three months climbed 1 percent to $7,527 a metric ton by 10:07 a.m. on the London Metal Exchange and zinc rose as much as 1.3 percent. Copper for delivery in May added 0.7 percent to $3.395 a poundon the Comex in New York.

Copper miners in Chile, the world’s largest producer, will hold a 24-hour nationwide strike today to push for greater job security. Exports were curbed by a three-week strike by port workers in the country. Industry officials are gathering this week in Santiago for CRU’s 12th World Copper Conference during CESCO Week.

Stockpiles of copper monitored by the LME rose 1.4 percent to 587,550 tons, the highest since Sept. 24, 2003, on deliveries in New Orleans and Johor, Malaysia. Orders to take the metal from warehouses climbed to a record for a third day, advancing 3 percent to 151,800 tons. About 26 percent of LME inventories now await delivery.

Aluminum for delivery in three months on the LME gained 0.5 percent to $1,899 a ton. Net income excluding a tax benefit and other one-time items was 11 cents a share, Alcoa said yesterday in a statement, beating the 8-cent average of 18 estimates compiled by Bloomberg. Demand for the lightweight metal in aircraft and cars improved, the company said.

Lead and nickel rose in London. Tin fell.

Crude Fluctuates on Inventory Forecast, Dollar West Texas Intermediate crude fluctuated as  analysts forecast that U.S. supplies increased from the highest level in 22 years and the dollar weakened against the euro.

Prices traded in an 87-cent range as a Bloomberg survey before a government report tomorrow

showed inventories probably gained for a 12th week. The dollar slipped to a three-week low against the euro,boosting oil’s appeal as an investment alternative. WTI’s discount to Brent, at the narrowest level in nine months yesterday, may continue to shrink, so investors should buy September WTI and sell the same-month Brent contract, Goldman Sachs Group (GS) Inc. said in a report today.

“We’ll see a continuous build in crude oil and fundamentally we should be around $85,” said Tariq Zahir, a New York-based commodity fund manager at Tyche Capital Advisors. “The dollar is weaker and that’s helping oil.” WTI oil for May delivery slid 29 cents to $93.07 a barrel at 9:49 a.m. on the New York Mercantile Exchange.

Trading was 33 percent below the 100-day average for the time of day. Prices last traded at $85 in November.Brent crude for May settlement rose 2 cents to $104.68 a barrel on the London-based ICE Futures Europe exchange. Trading was 6.7 percent above the 100-day average for the time of day.

Oil stockpiles probably grew by 1.45 million barrels to 390.1 million in the week ended April 5, after reaching the highest level since July 1990 in the previous week, according to the median of 10 analyst estimates before an Energy Information Administration report tomorrow.

Oil dropped the most in six months last week as supplies grew and production stayed above 7 million barrels a day,the most since 1992.