NEW YORK ( TheStreet) -- Base metals rose early Wednesday, powered by Chinese manufacturing data.
However, focus remains on weakness in the U.S. economic data which could cap the gains for the metals complex.
Major economic data for Wednesday include the ISM Manufacturing index for August which is forecast to drop to 52.8 from 55.5 in July, while the August reading for ISM prices paid is estimated at 55.3 from 57.5 in the prior month. Construction spending on a month-on-month basis for July is likely to come in at negative 0.5% after gaining 0.1% in June.
Copper for three-month delivery fell marginally early Wednesday. However, the metal reversed trend and accumulated gains of 2% to peak to four-month highs of $7,585, cheered by Chinese manufacturing data. LME copper inventories narrowed 1,575 tonnes to 398,525 tonnes Tuesday. The metal faces support and resistance at $7,351 and $7,592, respectively.
Sumitomo Metal Mining
, Japan's second-biggest smelter, said that its copper production will fall almost 10% below capacity as copper ore mined from Chile to Indonesia will be in short supply for almost five years. The company believes it is a seller's market for copper concentrates and the scenario won't not change before 2014 when supplies from new projects enter the market.
(SCCO - Get Report)
, which closed at $30.23 on Tuesday, has support at $29.70 and resistance at $30.71.
Freeport-McMoRan Copper & Gold
(FCX - Get Report)
closed at $71.99 with support and resistance at $70.25 and $73.36, respectively.
(TCK - Get Report)
closed at $33.38 with support at $32.69 and resistance at $33.94.
Aluminum for three-month delivery gained 0.4% to $2,067 per tonne early Wednesday. LME stockpiles shed 3,125 tonnes to close at 4.44 million tonnes Tuesday. The metal finds support at $2,028 and faces resistance at 2,070.
Chinese exporters of aluminum products are likely to face higher U.S. tariffs on the U.S. Commerce Department's tough stance that Beijing provided unfair subsidies to the industry. The additional tariff would be as high as 138%. The case was brought forward by the United Steelworkers Union and closely held aluminum manufacturers in nine U.S. states. Imports of Chinese aluminum products were valued at $514 million in 2009.
(AA - Get Report)
closed trading at $10.22 on Tuesday, finding support and resistance at $10.09 and $10.35, respectively.
(CENX - Get Report)
closed at $10 with support at $9.75 and resistance at $10.16.
(KALU - Get Report)
closed at $36.93 finding support at $36.35 and resistance at $37.40.