Industrial metals exchange traded funds (ETFs) such as those for copper and nickel have enjoyed a nice ride on the economic recovery, but some are wondering if momentum is waning for the sector.
Nickel producers, like Vale and Xstrata Plc, are increasing output after prices on nickel, which helps prevent corrosion in stainless steel, surged above $29,000 per metric ton in February, a high last seen in April 2008, reports Juan Pablo Spinetto for Bloomberg. Meanwhile, global output is projected to increase 10% on increased demand from construction and industrials as global economies improve.
At the World Economic Forum conference in Rio De Janeiro, Walter De Simoni, chief executive officer of Anglo American Brasil Nickel, commented that “after the 2008 crisis, the nickel business recovered faster than everybody would have thought and the price now is much stronger.”
However, pessimistic news attributed to worsening finances in Europe, cooling measure in China and rising inflation have dampened the confidence of copper bulls, reports Andrea Hotter for The Wall Street Journal. Copper prices have already receded more than 8% after tripling in around two years. [Copper ETFs Weak as Markets Await Fed.]