off-the-wire

METALS-Copper steadies on optimism over China and technical buying

Kitco Media
By Reuters
Published:
Updated:
Reuters
(Updates prices, adds U.S. data) By Eric Onstad LONDON, April 6 (Reuters) - Copper prices ticked higher on Thursday, boosted by optimism over recovering demand in top metals consumer China as speculators acted on upbeat technical signals.


But persistent concern about a potential recession after recent U.S. data curbed the gains. Three-month copper on the London Metal Exchange (LME) edged up 0.3% to $8,809 a tonne by 1600 GMT after a modest gain in the previous session. "After the U.S. data, recession worries are still there, lingering, so that could hold base metals back," said WisdomTree commodity strategist Nitesh Shah.


Weak U.S. job numbers on Thursday and other recent data have signalled a cooling economy. Copper prices touched their lowest in more than two weeks on Wednesday, but closed in positive territory and above the 100-day moving average, a positive technical signal. "The fundamentals remain strong and the latest Chinese PMI was pretty positive, with the composite way above the marker for expansion," Shah said.


The Caixin/S&P's composite purchasing managers' index (PMI), which includes both manufacturing and services activity, rose to 54.5 in March, marking the quickest expansion since June, data showed on Thursday. The latest survey provided some upbeat news after last week the PMI for the manufacturing sector faltered owing to weak export orders. Other data showed improved demand in China for the metal used in power, construction and air conditioning sectors. The Yangshan copper premium, which reflects demand for copper imported into China, ticked up to $32.50 a tonne on Tuesday for its first increase since March 17.


Also supporting the market was news that a joint copper mining project by Ecuador's state-run ENAMI and Chile's Codelco has been told to suspend operations.


In other metals, LME aluminium added 0.4% to $2,343 a tonne, nickel rose 0.2% to $22,755 and tin gained 0.3% to $24,310, while zinc edged down 0.2% to $2,783.50 after touching a five-month low on Wednesday and lead slipped 0.6% to $2,098.


For the top stories in metals, click (Reporting by Eric Onstad Additional reporting by Siyi Liu and Dominique Patton in Beijing Editing by David Goodman, Kirsten Donovan)


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