LONDON: Copper fell almost 4 percent on Thursday to its lowest in two weeks as plans to tackle the EU debt crisis stalled and concerns about an economic slowdown weighed on the metal demand outlook.
Other industrial metals also registered heavy losses and lead and zinc fell to a 15-month low.
Benchmark copper on the London Metal Exchange (LME) was at $7,008.25 by 0934 GMT, down more than 3 percent from a close at $7,210 per tonne on Wednesday.
Earlier, it hit a session low of $6,925 a tonne, its lowest in two weeks, and was on course for its fourth consecutive day of losses and for a slump of more than 7 percent this week.
"There were hopes for some solutions to be found at the summit but now these hopes seem to have been destroyed...data from China on the GDP front was also a negative surprise," said Commerzbank analyst Eugen Weinberg.
"Than is why we see a sell off. On the micro front there is no real reason for this but on the macro front sentiment is weak. It's not about fundamentals is about sentiment, and sentiment is a powerful thing."
Plans to tackle the euro zone debt crisis have stalled with Paris and Berlin at odds over how to increase the firepower of the region's bailout fund, French President Nicolas Sarkozy said on Wednesday.
The delay in finding an agreement spooked investors which are now focusing on the next summit of European leaders next weekend.
Earlier this week, data showed slower-than-expected GDP growth in top metals consumer China and this dimmed the demand outlook and weighed further on sentiment.
The global copper market registered a 312,500 tonnes surplus in January to August, up from a surplus of 128,000 tonnes in the whole of last year, according to data from the World Bureau of Metal Statistics, underlining weaker demand than previously expected.
FUNDAMENTALS DON'T MATTER
Supportive fundamentals had little impact on investor mood.
Freeport-McMoRan Copper & Gold Inc has been hit by strikes at two of its biggest mines, in Indonesia and Peru.
An eight-day strike in July and a second, continuing strike at its vast Grasberg mine in Indonesia, led to a loss of about 70 million pounds of copper in the third quarter, the company said on Wednesday.
Also, Zambian miners at NFC Africa Mining, majority-owned by China Nonferrous Metals Mining Corporation, went on strike earlier this week after the company refused to raise their wages.
Analysts said a prolonged spell of reduced production would impact the global market for the commodity but investors seemed to be dismissing fundamentals.
"We see more trouble, strikes at mines in Indonesia, Peru, Zambia but it's not about fundamentals at the moment, it's about macro; it's not about copper but it's about the euro," Weinberg said.
Zinc , used to galvanize steel, was at $1,783.75 from $1,838 Wednesday's close. Earlier it hit a session low of $1,746 a tonne, its lowest since July 2010.
The global refined zinc market will see a surplus of 317,000 tonnes this year and a more modest excess of 135,000 tonnes in 2012, the Lisbon-based International Lead and Zinc Study Group (ILZSG) said on Wednesday.
"We continue to think the zinc market is better balanced than these data suggest and, from a fundamental perspective, the zinc price should probably be stronger than today," Macquarie said in a research note.
"However, for the moment, financial market fears appear to be outweighing the more positive physical market picture, with the result there may be good buying opportunities ahead."
Battery material lead also fell to a 15-month low of $1,796.50 a tonne. It later traded at $1,833.25 from $1,870.
The global lead market was in surplus by 153,000 tonnes in the first eight months of the year, ILZSG data showed.
Tin was at $21,500 from $21,925 while aluminium was at $2,163 from $2,182 and nickel was at $18,343 from $18,800.