NEW YORK (TheStreet) -- Base metals accumulated marginal gains in early trading Tuesday after ending on a higher note in Monday's session.
Mixed housing market data and encouraging industrial activity numbers could add to the gains in base metals.
Major economic data releases lined up for Tuesday include the Producer Price Index for July, which is expected positive at 0.2% from June's fallback to a negative 0.5%. Meanwhile, July housing starts are expected at 560,000 vs. 549,000 recorded in June. Building permits for July are seen at 579,000 vs. 586,000 reported in June. With capacity utilization coming in at 74.5% from the earlier month's 74.1%, industrial production is forecast at 0.5% for July as compared to 0.1% in June.
Copper
Copper for three-month delivery was up 0.2% to $7,262 on the London Metal Exchange on bullish supply and a weakening dollar. LME copper inventories were down 1,850 tonnes to 406,700 tonnes Monday. The metal faces support at $7,249 and resistance at $7,274.
Reuters reported a sharp tightening in global copper output in the first half of the year since one-tenth of the world's copper miners produced 6% less than the same period a year ago. This indicates a tighter demand-supply scenario ahead. Major miners like Rio Tinto(RTP), BHP Billiton(BHP), and Freeport-McMoRan Copper & Gold(FCX) saw their output drop in the first half of the year.
Southern Copper(SCCO), which closed at $29.64 in the previous trading session, finds support at $29.18 and resistance at $30.06. Meanwhile, Freeport-McMoRan closed at $70.63 with support and resistance at $70.07 and $71.44, respectively. Teck Resources(TCK) closed at $32.36 with support at $31.72 and resistance at $32.89.
Aluminum
Aluminum for delivery within three months increased 0.6% to $2,130 per ton on the LME. The metal's LME inventories were down 4,425 tonnes to settle at 4.38 million tonnes Monday. Aluminum finds support at $2,121 and resistance at $2,141.
In a note to its customers, Alcoa(AA) announced an increase in prices for its European mill products to be delivered in the fourth quarter, underpinned by rising costs, metal premiums, alloying elements and energy costs.
Alcoa closed trading Monday at $10.64, with resistance at $10.55 and support at $10.76. Century Aluminum(CENX) closed at $10.09 with support and resistance at $9.92 and $10.32, respectively. Kaiser Aluminum(KALU) closed at $36.98 with support at $36.48 and resistance at $37.34.
Nickel
Nickel for delivery within three months advanced 0.2% to $21,600 per ton on the LME. Nickel inventories on the LME remained relatively flat at 117,012 tonnes Monday.
