What happened to the nickel price?
Nickel advanced as much as 2.9% to $12,380 per metric ton on the London Metal Exchange — its highest since June 2015. It joins copper at new multi-year highs and is further sign that the underlying global economy could be on the rise.
Burning the shorts
Australian nickel miner Western Area Resources [ASX:WSA] was one of the most shorted shares on the ASX. But investors betting on the WSA share price falling are starting to get nervous. Short interest has reduced from 20% of the total outstanding stock to 17% in the last 4 weeks.
That’s still high though and any further nickel price rises could see a scramble for the exits as shorters have to buy the share back at higher and higher prices. Good news for any WSA current shareholders
What now for commodities?
The Chinese manufacturing PMI rose by 0.5 points to 51.6 in August — the second highest reading of activity this year and the third consecutive month it has expanded after a period of softness earlier in the year.
A reading of 50 reflects the breakeven measure between expanding and contracting activity.
If this continues it’s good news for Western Areas Resources and all Australian miners. Click here to read a free report on the top 10 Australian mining stocks.