Copper slides

Copper hit a near two-week low on Monday, pressured by worries about weaker demand for industrial metals as Europe's move towards greater economic integration failed to calm fears of a deepening debt crisis and a potential regional recession. The downbeat view on Europe's economy more than offset upbeat data from top consumer China, where imports of copper, used in power and construction, reached their highest level since March 2010.
Three-month copper on the London Metal Exchange closed at $7,606 a tonne, down 2.6 percent from a last bid of $7,815 a tonne on Friday. Friday's European Union summit agreed to a stronger fiscal union and as much as 200 billion euros ($264.3 billion) in loans to the International Monetary Fund for it to help the region's struggling sovereign borrowers, but legal uncertainty surrounding the new pact and the absence of an unlimited financial backstop for the single currency kept investors cautious. "Markets are having a second look at this agreement and they're not impressed. The politics are proceeding at a much slower timetable than the market and that's the basic problem," Edward Meir, an analyst at INTL FCStone, said.
Copper, which is used in power and construction, had earlier fallen to a low of $7,565.50 a tonne, its weakest level since November 30. It is trading down 21 percent in the year to date. "Copper has moved back down through its 30-day moving average, and many are wondering whether the technical community are going to start selling short again," RBC said in a note.
Helping stem falls in metals, preliminary data from China showed on Saturday that copper imports rose 17.9 percent in November to 452,022 tonnes, with buyers taking advantage of cheaper prices. The latest Reuters poll showed that economists expect China's economy to grow by 8.6 percent in 2012, after an estimated expansion of more than 9 percent this year. Supply concerns also limited copper's falls. An Indonesian workers' union plans to extend a three-month strike at Freeport McMoRan Copper & Gold's Grasberg mine, the world's second-largest copper mine, until January 15.
In other metals, aluminium ended at $2,015 a tonne from a close of $2,065 a tonne on Friday. Latest LME data showed aluminium stocks hit a record 4.72 million tonnes as a souring economic outlook crimped demand and as tighter credit conditions in Europe spurred holders of the metal to sell their stock for cash.
Zinc, used in galvanising, ended at $1,932 from a close of $2,003 a tonne on Friday, while tin, which slipped to an 11 week low at $19,400, closed at $19,900 from $20,250. Battery material lead ended to $2,105.50 from $2,165, while stainless-steel ingredient nickel closed at $18,450 from $1,860. It outperformed all other metals last week with a gain of 5.7 percent. Prices have been boosted by talk that nickel pig iron producers in China are cutting output as they struggle to make profits at current price levels, meaning smelters will be forced to buy more refined nickel going forward.