Strikes at two Freeport-McMoran Copper & Gold Inc. mines lent little support.
Three-month copper on the London Metal Exchange (LME) fell to $7,354 a tonne by 0909 GMT from Tuesday's close of $7,449. The metal used in power and construction fell in the previous session after top consumer China's economic growth data came in a touch lower than expected.
"I think there is a bit of concern about demand from China. This week we saw relatively weak GDP numbers and of course copper is the most China-sensitive base metal," Danske Bank analyst Arne Lohmann Rasmussen said.
"At the moment the market's trading on global themes, global risk appetite. Maybe we are moving into slightly calmer waters when we can start focusing on more specific issues, but this week it is about the European debt crisis and what is going to happen at the summit."
The euro trimmed some earlier gains after European officials denied an agreement to boost the euro zone bailout fund had been reached, dimming the prospect of a breakthrough at this weekend's EU summit.
Senior EU officials said no agreement had been reached on increasing the size of the fund, dismissing a report in Britain's Guardian newspaper that said France and Germany had reached such a deal.
A downgrade of Spain's debt rating by Moody's ratings agency also weighed on the euro as it served as another reminder to European leaders that they must make rapid progress on solving their debt problems.
"... Uncertainty over Greece's bailout and the lack of clear agreement on crisis management mechanics under the EFSF (the stability and rescue fund) are deterring riskier trades for the moment," VTB Capital said in a note.
Investors will watch out for data from the United States, the world's largest economy, due later on Wednesday, including the September Consumer Price Index and housing starts and permits.
STRIKES AT MINES
Copper inventories in LME warehouses rose 250 tonnes to 452,175 tonnes, latest data showed. Levels are about a third higher since December.
Aluminium stocks fell 2,725 tonnes to 4,571,625 tonnes.
News that Freeport-McMoRan has threatened to close its strike-hit Grasberg mine in Indonesia, the world's second largest, could provide a floor for prices.
The company's Cerro Verde mine in Peru has also been plagued by a labour dispute. Talks between management and union leaders are scheduled for Thursday in what would be a final bid to end a 20-day-old strike.
"Production disruptions at large copper operations in Peru and Indonesia have extended, while the loss of output continues to rise. This keeps the physical copper market tightly supplied," Credit Suisse said in a note.
"While fundamentals speak in favour of firmer prices, lacking technical momentum and the uncertain macro environment continue to flag risks for a short-term retracement."
Among other metals, aluminium traded at $2,207 from $2,208 a tonne at Tuesday's close.
The United Arab Emirates (UAE) plans to make possibly the largest-ever investments in Indonesia's industrial sector by pumping $9.5 billion into aluminium smelter projects in Kalimantan, Indonesia's ambassador to the UAE said.
Battery material lead was at $1,915 from $1,925 a tonne, having earlier hit a two-week low at $1,900.25 a tonne.
Nickel traded at $19,000 from $19,150 per tonne. Australian nickel miner Panoramic Resources PAN.AX said on Wednesday it has reached an agreement with BHP Billiton BHP.AX BLT.L to increase its tonnage of nickel shipments to BHP for processing under a tolling arrangement.
Tin traded at $21,300 from $21,345 a tonne while zinc was at $1,852 from $1,882 a tonne.
Copyright Reuters, 2011