Nickel slumps

Melbourne
London nickel slumped to its weakest level in more than a decade on Friday, as traders shorted the metal used by China´s struggling stainless steel industry, gripped by a wider downturn across industrial metals demand.
The collapse of nickel prices, the first industrial metal to drop to levels last seen before the 2008-2009 financial crisis, underscores the pressure on base metals as China´s economy transitions from manufacturing to a service sector-led economy. "The main story is the steel outlook in China. Clearly the demand side remains extremely weak," said analyst Dominic Schnider of UBS Wealth Management in Hong Kong. Chinese steel demand shrank around 6 percent in January-October, according to the China Iron and Steel Association, reflecting slower industrial activity as the world´s No. 2 economy heads for its weakest growth in 25 years. Shanghai steel prices hit a record low this week.