By Allen Sykora
(Kitco News)-- MF Global remains “cautious” about the short-term outlook in base metals despite Wednesday’s gains that came after a strong ISM manufacturing survey.

“Technically, many metals have pushed near the top or outside of their trading ranges, arguing for caution going forward,” says analyst Edward Meir.

“Moreover, the positive ISM number that sparked yesterday’s move reminds us of the better-than-expected industrial production figure released a few weeks ago that similarly triggered a sizable rally in a number of markets, only for the gains to fizzle out in the weeks ahead on a lack of follow-through.”

Thus, much hinges on U.S. macro-economic data during the remainder of the week, with Friday’s non-farm payrolls report “especially critical,” Meir says.

Early indications suggest potential for this data to disappoint, since the ADP report on Wednesday showed private-sector job losses last month, Meir points out.

By Allen Sykora, contributing to Kitco News; asykora@kitco.com