Markets

Shanghai copper sheds 1 percent as Japan crisis weighs

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Japan, in a battle to avert catastrophe, sent military helicopters to douse overheating reactors at a nuclear power plant hit by last week's earthquake.

"The market sentiment remains fragile," said Lin Yuhui, deputy general manager at Jinhui Futures. "The impact of the nuclear crisis is still unknown, but it will sure take a huge toll on the economy."

Japan said the damage from last week's devastating earthquake to the economy would be limited, but bigger than the 20 trillion yen ($255 billion) bill from the 1995 earthquake that hit the city of Kobe. Three-month copper on the London Metal Exchange  edged down 0.4 percent at $9,225 a tonne by 0701 GMT, after posting its biggest one-day rise in 2-1/2 weeks on Wednesday.

Shanghai's most-active copper futures contract lost 1 percent at 69,810 yuan ($10,623).

"There has some buying from the Chinese -- some found the current price level decent for import pricing, others just put in speculative bids," said a Shanghai-based trader.

"It may go on for a bit, but whether we'll see copper prices strengthen again eventually depends on the prospects of the global economy."

The even looser monetary policy adopted by the Japanese central bank after the massive earthquake and tsunami hit last Friday could potentially benefit metals, Lin said.

LME aluminium gained 0.7 percent at $2,476, after dropping to $2,452 on Wednesday, its lowest since late January.

Shanghai aluminium lost 0.8 percent at 16,525 yuan.

Japan's benchmark Nikkei share average ended down 1.4 percent, reversing a 4 percent rally in the previous session, as the Japanese yen surged to a record high.

Indonesia's state-owned PT Timah , the world's largest integrated tin miner, has no shipments scheduled for quake-hit Japan this month under its 2011 term contracts, and is awaiting further information from its Japanese buyers, an official said on Thursday.     LME tin fell by 0.7 percent at $28,400.

Copyright Reuters, 2011