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Copper rises on China stimulus hopes, trade talk progress

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China said on Monday it would relax residency curbs in many of its smaller cities and increase infrastructure spending to boost economic growth. On Sunday, China also announced measures to encourage financing for small and medium-sized businesses.

In the peak April-May copper consumption season, short position holders are "powerless" as it will be impossible to make a case for weak demand over this period, Chinese brokerage Jinrui Futures wrote in a note.

Production growth in China's air conditioning sector, a big consumer of copper, is set to grow by 7.9 percent this month, it added.

US and Chinese negotiators wrapped up their latest round of trade talks on Friday. The US Trade Representative said significant work remains, while Chinese state media said the two sides had made "new progress" in the talks.

"This Chinese comment may well have triggered some of the metals buying," said Malcolm Freeman, director and chief executive of Kingdom Futures in a note.

FUNDAMENTALS

COPPER: Three-month copper on the London Metal Exchange rose as much as 1 percent to $6,466 a tonne and was up 0.7 percent at $6,448 a tonne by 0714 GMT.

CESCO: Global copper producers are converging in Chile this week as tightening supply buoys prices, even as the industry grapples with declining ore quality, project delays and worries the U.S-China trade war may hit long-term demand.

PERU: MMG Ltd said its Las Bambas mine in Peru is expected to restore normal mining, production and transport operations after an indigenous village agreed to end a two-month blockade of the company's copper mine.

SHFE: Shanghai Futures Exchange metals were mixed as trading resumed after a long weekend in China. ShFE copper fell 0.4 percent to close at 49,260 yuan ($7,332.76) a tonne, while aluminium crept up 0.1 percent at 13,805 yuan.

OTHER METALS: Nickel and lead gained while zinc and tin fell.

INDONESIA NICKEL: Indonesia's first plant to produce battery-grade nickel chemicals is on track to start operations by 2020, though the project still needs an environmental permit that could take up to eight months to be approved.

Copyright Reuters, 2019