October 3, 2011 / 3:19 PM / 9 years ago

Nickel jumps over 5%, traders cite short-covering

LONDON, Oct 3 (Reuters) - Nickel rose more than 5 percent on Monday, which traders attributed to short-covering and comments from Norilsk Nickel on output, although they said low volumes could be exaggerating moves.

Benchmark nickel rose to a session high of $18,695 a tonne, from $17,600 at Friday’s close.

Norilsk, the world’s largest producer of nickel and palladium, told Reuters about 10 percent of world nickel producers are losing money at current prices and could cut output by as much as 30,000 tonnes in the fourth quarter.

“It could be some short covering in the market. The Chinese are on holiday this week, so the volumes might be quite thin. The comments from Norilsk could also be helping,” a trader said.

Reporting by Harpreet Bhal, editing by Jane Baird

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