MUMBAI, Dec 5 (Reuters) - India copper futures extended losses and fell over 3 percent in afternoon trade on Friday, dragged down by weak demand and a firm dollar, analysts said.
Continuous negative data from major metal-consuming nations is reinforcing worries over a deepening global recession, which will hurt demand for industrial metals such as copper.
At 4.34 p.m., the benchmark Februray copper MCCG9 on the Multi Commodity Exchange of India (MCX) was down 2.96 percent at 165.55 rupees per kg.
The dollar firmed against the euro as investors covered short positions, but its gains were limited ahead of key U.S. employment data due later in the session. [USD/]
A strong dollar makes dollar-denominated commodities expensive for holders of other currencies and caps demand.
A rise in copper inventories at London Metal Exchange warehouses by 4,325 tonnes to 297,300 tonnes on Friday also pressured prices.
"The market is currently awaiting the U.S. employment data which will be key for further direction," said Pravin Singh, an analyst with Sharekhan Commodities.
During the day traders will be closely watching U.S. average earnings, manufacturing payroll and non-farm payrolls data, along with currency markets to gauge further direction of the markets.
However, technical analysts see a bounce back from current levels.
"Prices are expected to bounce back slightly from the current levels as there is some short-covering expected after continuous falls," said B.G.Manjunath Prasad, senior technical analyst with Way 2 Wealth Securities Ltd.
Lead and zinc prices were also pressured by the strong dollar and fell on Friday.
At 4.34 p.m., benchmark December lead MLDZ8 on the MCX was down 1.43 percent percent at 48.35 rupees per kg, while December zinc MZIZ8 was down 2 percent at 56.4 rupees per kg.
(Reporting by Nandita Bose; Editing by Rohini Ananthan)
