By Eric Onstad
LONDON, March 23 (Reuters) – Benchmark nickel on the London Metal Exchange (LME) rallied 15% on Wednesday, hitting its trading limit, easing the trend and trading higher for the first time since it was deals with the metal were suspended last week.
Nickel on the LME gained 5.5% at the open and held at early trading hours highs, but soared by almost $3,000 in a span of about 20 minutes.
The industrial metal reached its trading ceiling of $32,380 a tonne and at 1200 GMT it was still trading at this threshold.
One trader said it was unclear what was behind the regretful jump, but it could be due to automated trading systems.
“In any case, the underlying market is tight, so if you factor in the Russian uncertainty, it looks cheap to me,” he said.
Nickel tumbled for several days and repeatedly hit its lows after trading restarted after a pause to calm the market.
Nickel volumes on the LME have rebounded since Tuesday, suggesting the market is beginning to return to normal after two weeks of chaos.
The world’s main nickel trading hub suffered a record price surge, a six-day trading suspension and then a restart affected by technical glitches.
(Reporting by Eric Onstad. Editing in Spanish by Marion Giraldo)