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Copper hovers near 5-week high on softer dollar, China stimulus hopes

Kitco News

Nov 15 (Reuters) - Copper held steady on Wednesday, hovering near a five-week peak scaled in the previous session, buoyed by a weaker U.S. dollar and expectations of more stimulus measures in top consumer China.

Three-month copper on the London Metal Exchange was little changed at $8,226.50 a metric ton by 0708 GMT after hitting its highest since Oct. 2 on Tuesday.

The most-traded December copper contract on the Shanghai Futures Exchange closed 0.5% higher to 67,770 yuan ($9,359.72) a ton.

The dollar stuttered at broadly lower levels after slumping overnight. A weaker greenback makes dollar-priced commodities less expensive for holders of other currencies. "There was some profit taking seen as LME and SHFE opened this morning, but the elevated prices stayed supported as China retail sales beat expectations," a Singapore-based metals trader said.

"I think base metals can hold their ground amidst the improving macro environment and more fresh longs should be built up over the coming weeks."

China's October economic activity perked up as industrial output grew at a faster pace and retail sales growth beat expectations.

However, China's property sales fell at a faster pace in October and investment in real estate slumped, official data showed, suggesting the crisis-hit sector is yet to emerge from its decline.

The real estate sector is a major contributor to China's metals consumption.

Bloomberg News reported on Tuesday China plans to provide at least 1 trillion yuan of low-cost financing to the nation's urban village renovation and affordable housing programs, citing people familiar with the matter.

LME aluminium gained 0.1% to $2,233.50 a ton, nickel eased 0.2% to $17,450, zinc added 0.6% to $2,615, lead edged up 0.2% to $2,205.50 and tin was almost flat at $25,185.

SHFE aluminium gained 0.3% to 18,995 yuan a ton, nickel was up 0.6% at 139,300 yuan, zinc gained 1.4% to 21,880 yuan, lead gained 0.3% to 16,505 yuan and tin was steady at 213,750 yuan.

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(Reporting by Brijesh Patel in Bengaluru; Editing by Subhranshu Sahu, Janane Venkatraman and Sohini Goswami)

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