Shanghai metals rise after China vows to shore up industrial growth

The most-traded metals contracts on the Shanghai Futures Exchange rose on Monday after China's industry ministry vowed to stabilise the machinery, autos and electrical equipment sectors.

China will roll out action plans to stabilise growth in these industrial sectors, Tao Qing, an official from the ministry, said on Friday.

The move is designed to "improve premium supply capacity" to set up the industry for an effective upgrade in quality terms and reasonable growth as measured by quantities, while promoting an "orderly exit of outdated production capacity", Tao added.

SHFE zinc gained the most, rising 2.8% to 22,925 yuan ($3,194.85) a ton as of 0705 GMT. Earlier, the contract hit 22,945 yuan, the highest since April 3.

SHFE nickel added 1.91% to 122,550 yuan, copper rose 1.77% to 79,700 yuan, while aluminium climbed 1.63% to a peak since March 27 at 20,840 yuan. Tin advanced 1.27% to 267,250 yuan, and lead gained 0.86% to 16,960 yuan.

"What China's industrial ministry said has been encouraging for metals in general," a Beijing-based metals analyst at a futures company said, adding, "industrial sectors are all very relevant to metals."

In addition to the downstream industries, the action plan will cover 10 key industries, including steel, nonferrous metals, petrochemicals and construction materials, the ministry noted.

"Metals in general have responded positively to the news, and whichever with more room for price growth will strengthen more remarkably," a Shanghai-based metals analyst at a futures company said.

Prices on the London Metal Exchange also gained, except for lead. Three-month zinc climbed the most, rising 0.94% to $2,845 per ton. Earlier in the session, it touched $2,850, the highest since April 1.

LME copper rose 0.85% to $9,862 per ton after touching $9,883 earlier - the highest since July 8. Nickel added 0.74% to $15,330, tin gained 0.64% to $33,660, while aluminium rose 0.48% to $2,642, the highest since June 23.

Lead eased 0.07% to $2,008.5.