June 1 (Bloomberg) -- Copper fell for a second day in New York and London on concern about the outlook for demand in China, the world’s biggest consumer, after manufacturing expanded at a slower pace and property transactions dropped. Investors are concerned that China may try to “restrain growth and curb lending,” Andrey Kryuchenkov, an analyst at VTB Capital in London, said by phone. Futures for July delivery dropped 5.85 cents, or 1.9 percent, to $3.046 a pound at 8:07 a.m. on the Comex in New York. Copper for delivery in three months fell 3 percent to $6,729 a metric ton on the London Metal Exchange. All of the six main metals traded on the LME retreated. Copper may slide toward $6,600 a ton on the LME, according to Kryuchenkov. Prices fell 6.6 percent in May in London after dropping 4.6 percent in April, also hurt by concern that Greece’s fiscal crisis might spread to other euro-zone economies. The metal also declined last month as the dollar strengthened for a sixth month in a row as measured by the U.S. Dollar Index, a six-currency gauge of the greenback’s value. Dollar Strengthens A stronger dollar makes metals priced in the U.S. currency more expensive in terms of other monies. Copper fell today as the index gained as much as 1 percent, advancing for a sixth day in seven. Fitch Ratings on May 28 stripped Spain of its AAA credit grade, saying the nation’s debt burden is likely to weigh on economic growth. Europe consumes 20 percent of global copper output and 15 percent to 25 percent of aluminum, zinc, nickel and lead production, according to Barclays Capital. “Spain was downgraded,” VTB Capital’s Kryuchenkov said. “It is affecting sentiment, and we see another spike in risk aversion.” Copper has dropped 8.7 percent this year on the LME as the dollar index has gained 12 percent. The euro has slumped 15 percent against the U.S. currency. Smaller Stockpiles Inventories of copper tracked by the LME slipped for a 10th day today to 475,575 tons. Stockpiles have dropped 14 percent since this year’s peak on February 18. Bookings to remove metal from warehouses fell for a fourth day to 22,225 tons. Aluminum for three-month delivery on the LME fell 2.9 percent to $1,984 a ton. Inventories in LME-monitored warehouses dropped for a seventh day to 4.56 million tons. One market participant holds between 50 percent and 79 percent of available metal, the latest data from the bourse showed. Zinc dropped 4.4 percent to $1,850 a ton. Stockpiles in LME and Shanghai warehouses rose to a record. LME open interest, the number of contracts outstanding, rose on May 27 to the highest since March 2009 and has gained 16 percent this year. Lead fell 4.3 percent to $1,771 a ton. LME inventories rose to the highest since October 2002. Tin declined 2 percent to $17,545 a ton and nickel slid 3.7 percent to $20,570 a ton. The LME was closed yesterday for a public holiday in the U.K., and Comex floor trading was shut for Memorial Day.

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