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The ongoing slump in U.S. equities market continues to weigh heavily on the base metals complex, where prices were mostly down this morning on LME, struggling to maintain any momentum to the upside.


An early morning sell-off in the copper market has three-month prices already under previously steady support pegged at $1,650/mt. Although a move below $1,640/mt in intra-day activity was quickly halted by bargain hunters, confidence in the red metal remains low.

Declining LME stock levels, down another 1,225 mt today, has done little to bolster sentiment, with players acknowledging that significant production cutbacks may be necessary to help reclaim upward movement. On Comex, yesterday's poor technical close in September copper is likely to set up further losses, particularly with this morning's weakness on LME. The market may be limited to a 73 to 78 cent range in the near term, with the emphasis conceivably remaining on the downside.


As for lead, three-month metal has fallen from yesterday's nine-week high level, as the market has succumbed to bearish sentiment running throughout the complex. Rumors continue to circulate concerning production cutbacks from European producers, and this may still help lead break out of its recent funk.

For the time being, resistance at $470/mt will hold as the initial upside target, with the technically key $500/mt looming well off on the horizon. Late selling pressure dragged three-month zinc below $830/mt, where the market has found solid support, staving off a correction toward $800/mt.

Three-month nickel eased down a bit from early afternoon trade on LME, where prices set a 32-month high, but still managed an extremely strong close at $7,575/mt, well above resistance at $7,545/mt, with an eye on $7,600/mt in the near term. The next major resistance level at $8,000/mt looms on the horizon.


As for copper, three-month metal's failure to re-establish support at $1,650/mt has further soured market sentiment, making a slide back toward $1,600/mt a possibility in nearby dealings. On Comex, a nearly one cent drop saw September copper breach support at 75.15, and a clean break of 75 cents may likely follow.


Elsewhere, aluminum recouped this morning's losses, but three-month prices were unable to push over $1,380/mt, its initial upside target. An LME stock draw of 2,875 mt helped limit the downside earlier today. Three-month tin has remained a steady performer on LME, holding above $4,400/mt, with the market next looking toward $4,500/mt in the immediate future. In zinc, a brief visit above $840/mt proved unfruitful for three-month metal, although today's firm close may still set up a possible probe of this key level.

MORNING MARKET REPORT THU JUL 11, 2002
_____________ LONDON METAL EXCHANGE (RING CONTRIBUTOR) __________________


Contract(US$/mt) ---- Time Last +/- High Low Prev_Cls Open Settle
ALUMINUM (3-mo) 8:15 1371 -6 1373 1371 1377 1373
ALUMINUM (spot) -8:15 1351.5 -5.7 1351.5 1351.5 1357.2 1351.5 1351.5
N_A_ALLOY(3-mo)- 8:15 1490 +5 1490 1480 1485 1490
N_A_ALLOY(spot) --8:15 1495 +4 1495 1485 1491 1495 1495
AL_ALLOY (3-mo) -- 8:15 1285 UNCH. 1285 1285 1285 1285
AL_ALLOY (spot) --- 8:15 1275 -6 1275 1275 1281 1275 1275
COPPER (3-mo) ------ 8:15 1644 -17.5 1645 1643 1661.5 1645
COPPER (spot) ------- 8:15 1622.5 -19.2 1622.5 1622.5 1641.7 1622.5 1622.5
LEAD (3-mo) ---------- 8:15 465 -4 465 465 469 465
LEAD (spot) ----------- 8:15 454.5 -4.2 455 454.5 458.7 454.5 454.5
NICKEL (3-mo) ------ 8:15 7420 -25 7420 7365 7445 7370
NICKEL (spot) ------- 8:15 7400 -25.5 7400 7400 7425.5 7400 7400
TIN (3-mo) ------------ 8:15 4440 -15 4440 4430 4455 4430
TIN (spot) ------------- 8:15 4405 -10 4405 4405 4415 4405 4405
ZINC (3-mo) ---------- 8:15 828.5 +0.5 828.5 827 828 827
ZINC (spot) ---------- 8:15 808.5 -1.5 808.5 808.5 810 808.5 808.5


Contract(Cents/lb)Time Last +/- High Low Prev_Cls Open Settle
ALUMINUM (3-mo) 8:15 62.19 -0.27 62.28 62.19 62.46 62.28
ALUMINUM (spot) 8:15 61.30 -0.26 61.30 61.30 61.56 61.30 61.30
N_A_ALLOY(3-mo) 8:15 67.59 +0.23 67.59 67.13 67.36 67.59
N_A_ALLOY(spot) 8:15 67.81 +0.18 67.81 67.36 67.63 67.81 67.81
AL_ALLOY (3-mo) 8:15 58.29 UNCH. 58.29 58.29 58.29 58.29
AL_ALLOY (spot) 8:15 57.83 -0.27 57.83 57.83 58.11 57.83 57.83
COPPER (3-mo) 8:15 74.57 -0.79 74.62 74.53 75.36 74.62
COPPER (spot) 8:15 73.60 -0.87 73.60 73.60 74.47 73.60 73.60
LEAD (3-mo) 8:15 21.09 -0.18 21.09 21.09 21.27 21.09
LEAD (spot) 8:15 20.62 -0.19 20.64 20.62 20.81 20.62 20.62
NICKEL (3-mo) 8:15 336.57 -1.13 336.57 334.07 337.70 334.30
NICKEL (spot) 8:15 335.66 -1.16 335.66 335.66 336.82 335.66 335.66
TIN (3-mo) 8:15 201.40 -0.68 201.40 200.94 202.08 200.94
TIN (spot) 8:15 199.81 -0.45 199.81 199.81 200.26 199.81 199.81
ZINC (3-mo) 8:15 37.58 +0.02 37.58 37.51 37.56 37.51
ZINC (spot) 8:15 36.67 -0.07 36.67 36.67 36.74 36.67 36.67
LME STOCKS (07-10-02 CLOSE) (metric ton)
Aluminum Al_Alloy Copper -- Nickel -- Lead ------- Tin ----Zinc
1,264,775 • 53,560 • 880,300 • 26,712 --• 188,525 • 37,780 • 598,775
-2,875 -1,060 -1,225 -624 +775 +270 -725

_______________________________ COMEX/NYMEX __________________________________

Contract Time Last +/- High/Low Prev_Cls Open Settle
COPPER Jul'02 8:10 74.50 -0.75 74.85/ 74.50 75.25 74.85
COPPER Sep'02 8:18 75.00 -0.85 75.85/ 74.90 75.85 75.80
COPPER Dec'02 8:18 75.70 -0.85 75.90/ 75.70 76.55 75.90
STOCKS: Copper: 362,249 +2,124 Aluminum: 74,608 (304,990pc)
Gold : 1,911,020 UNCH. Silver : 105,240,902 -1,514,293
COPPER SCRAP 07-10-02 PRECIOUS METAL 07-10-02 CURRENCY 7:30
#1 bare bright 71.00_H&H Gold: 314.80 _US$=EURO 0.9843
#1 burnt 70.00_H&H Silver: 5.095 _US$=MPES 9.8200 US$=CAN 1.5240
#2 refinery 62.00_Engelhard: Pt 527 Pd 326_US$=B£ 0.6484 US$=J¥ 117.20
EQUITIES CONTINUE TO WEIGH ON METAL MARKET; COPPER UNDER $1,650/MT SUPPORT