* LME copper little changed, Shanghai up 0.5 pct
* Market lacking "monumental news" to reverse
mindset-analyst
* LME copper's rebound may be over-technicals
* Coming Up: ECB's Trichet speaks in Frankfurt, 0900 GMT
By Manolo Serapio Jr.
MANILA, June 9 (Reuters) - Copper struggled to hold on to
small gains on Wednesday as Europe's debt problems continued to
gnaw at investor confidence, with technical factors pointing to
a further decline after recent heavy losses.
Europe's debt crisis, which threatens to spread to
countries that do not use the euro, such as Hungary and
Britain, has pummelled equity and commodity markets with
investors worried it will impede recovery in an already fragile
global economy.
Asian stocks retreated in tandem with the Dow Jones futures
DJc1, with Japan's benchmark Nikkei .N225 down 1 percent to
near six-month lows.
Market players are awaiting a speech later in the day by
European Central Bank chief Jean-Claude Trichet ahead of an ECB
meeting on Thursday where the bank could announce plans to
offer extra funds to banks to ease strains from the euro zone's
debt crisis. [ID:nLDE6560K2]
"A lot of people are still pretty worried about the
situation in Europe, whether it's going to be an even bigger
problem than it is now," said Judy Zhu, commodity analyst at
Standard Chartered Bank in Shanghai.
Three-month copper on the London Metal Exchange CMCU3
edged up $4 to $6,169 a tonne by 0303 GMT. The metal gained $65
to end at $6,165 on Tuesday, its first advance in seven
sessions.
LME copper had been trading in a tight $86-range and may be
ready to dip again after completing a rebound that has pushed
it to a high of $6,246 on Wednesday, Reuters market analyst
Wang Tao said. [TECH/C-MET]
For a graphic of the technical outlook, double-click:
here
LME copper has lost more than 23 percent since hitting this
year's high above $8,000 in April, pounded by Europe's credit
crisis and fears of slower demand from China, the world's top
consumer of the metal.
"Markets are still lacking any monumental news that could
turn the bearish mindset around," said MF Global analyst Edward
Meir.
"More importantly, investors clearly seem to be concluding
that slowing growth will now follow the asset price implosion
we have seen hit the equity and commodity markets.
"We do not think this linkage is necessarily valid at this
point, as we suspect the global recovery will remain intact,
given the enormous stimulus out there. However, markets have
not come around to discounting this notion just yet, meaning
that prices may continue to be vulnerable for a little while
longer," Meir said in a note to clients.
In Shanghai, the benchmark third month copper SCFc3 added
220 yuan to 49,650 yuan ($7,270) a tonne, ending a three-day
losing streak.
For a graphic of the SHFE technical outlook, double-click:
here
While metal prices look like they could suffer further
declines, Standard Chartered's Zhu said some investors were
taking advantage of the big falls.
"I visited a lot of clients in the past few weeks and none
of them said that they will short metals in the longer term. A
lot of them still regard the recent falls as a good opportunity
to re-enter the market."
Base metals prices at 0303 GMT
Metal Last Change Pct Move End 2009 YTD pct
chg
LME Cu 6169.00 4.00 +0.06 7375.00
-16.35
SHFE Cu* 49650.00 220.00 +0.45 59900.00
-17.11
LME Alum 1918.00 -2.00 -0.10 2230.00
-13.99
SHFE Alum* 14210.00 35.00 +0.25 17160.00
-17.19
COMEX Cu** 277.25 0.00 +0.00 332.75
-16.68
LME Zinc 1690.00 -44.00 -2.54 2560.00
-33.98
LME Nickel 18300.00 -170.00 -0.92 18525.00
-1.21
LME Lead 1609.00 -1.00 -0.06 2432.00
-33.84
LME Tin 16050.00 120.00 +0.75 16950.00
-5.31
LME/Shanghai arb^ -359
Dollar/yuan 6.8291 \ 6.8301
** 1st contract month for COMEX copper
* 3rd contact month for SHFE aluminium, copper and zinc
^ LME 3-m copper in yuan, including 17 pct VAT, minus SHFE
third month
(Reporting by Manolo Serapio Jr.; Editing by Clarence
Fernandez)
