Zinc plunged despite solid demand from China

Source: Dukascopy Bank SA
Industrial metals were bearish on Wednesday despite positive news from the US. The latest data showed US employers increased hiring more than expected last month. Moreover, on Tuesday, China left its growth target at 7.5%, boosting demand prospects for the commodity group.

Aluminum sagged 1.16% after Sumitomo Corp. raised its forecast for the world's aluminum surplus to a two-year high, saying that China's demand is not likely to absorb new capacity. The company expects global surplus to attain 866,000 metric tonnes in 2013.

Copper fell on worries over elevated inventories at the LME. Stocks at the LME more than doubled since the beginning of October, while inventories at the Shanghai Futures Exchange reached a one-year high last month.

Nickel retreated amid weak demand from alloy industry and solid greenback. However, losses were limited by expectations for an increase in China's demand ahead of Indonesian nickel ore export ban due to take effect in 2014.

Zinc was the top loser despite signs of robust demand from China. China's imports of refined zinc increased 7.8% year on year in January.
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