Markets

China optimism keeps copper near 5-month high

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Benchmark copper on the London Metal Exchange was unchanged at $5,966.50 at 1422 GMT, still close to Monday's high of $6,022.50 - the first rise above $6,000 since March 2.

"There's still a halo effect from the stronger-than-expected Chinese numbers," ETF Securities analyst Nitesh Shah said.

CHINA GROWTH: The Asian Development Bank raised its 2017 and 2018 growth forecasts for China and other countries in the region.

CHINA ECONOMY: However, Fitch Ratings said China's renewed commitment to contain financial risks signals a possible shift away from high economic growth targets.

COPPER STOCKS: On-warrant stocks in LME-registered warehouses remained near the highest since mid-May, falling 50 tonnes to 230,100 tonnes.

SPECULATORS: "Net long positions in lead, copper, nickel and zinc are as much as 45 percent above the average," analysts at Commerzbank wrote in a note. "This entails the risk of a marked price correction if speculative financial investors choose to turn their backs on base metals."

SPREADS: Discounts of cash copper, aluminium and lead to their three-month contracts were at multi-year highs, signalling ample nearby supply.

NICKEL: Stainless steel ingredient nickel was down 0.8 percent at $9,570 after Chinese rebar and iron ore futures slipped following a 25-percent rally. Nickel was just above its technically important 100-day moving average.

DOLLAR: The dollar fell towards a 14-month low against the euro after European Central Bank chief Mario Draghi said policymakers would discuss possible changes to its bond-buying scheme in the autumn.

US ECONOMY: Jobless claims fell more than expected to the lowest level in nearly five months, suggesting strong job gains that should continue to underpin economic growth.

TRUMPCARE: Republicans failed to resolve differences on healthcare legislation, fuelling doubts that President Donald Trump can deliver promised economic stimulus that would boost demand for metals.

CHINA-US TRADE: The United States and China failed to agree on major new steps to reduce the US trade deficit with China.

PERU STRIKES: Unionised workers in Peru, the world's second-biggest copper producer, began a nationwide strike to protest against labour reforms, but significant disruptions to output were not expected.

ALUMINIUM: Daily average output from China rose to a record 97,700 tonnes in June while ex-China production also rose. Benchmark aluminium was flat at $1,920 a tonne.

PRICES: Lead was up 0.3 percent at $2,223.50, tin was flat at $20,090 and zinc was 0.3 percent lower at $2,738.

 

Copyright Reuters, 2017