Copper rose for a second day in London on speculation that last week’s drop was exaggerated at a time when inventories of metal are at a seven-month low, indicating steady demand. Stockpiles tracked by the London Metal Exchange declined for a 12th day today and have slid for 33 of the past 34 sessions. Bookings to remove copper from LME warehouses increased to the highest level in almost four months on July 1. “Prices are creeping higher after the strong losses last week,” Eugen Weinberg, an analyst at Commerzbank AG in Frankfurt, said by phone. Copper for delivery in three months rose $103, or 1.6 percent, to $6,513 a metric ton at 10:09 a.m. on the LME. The contract lost 5.3 percent last week. Futures for September delivery gained 1.1 percent to $2.9485 a pound on the Comex in New York. Weinberg predicted “thin trading,” citing the U.S. Independence Day holiday. Comex floor trading is shut today. LME prices last week dropped the most since the week ended June 4 as figures showed slower growth in manufacturing in China, the world’s top copper consumer. Auto sales in the country weakened in June and a services-industry index slid to a 15-month low, adding to signs that the economy leading the world recovery is cooling, reports showed today. Car Sales Passenger-car purchases rose 10.9 percent from a year earlier, down from May’s 25 percent gain, the China Automotive Technology & Research Center said. The services-industry measure fell to 55.6 from 56.4, HSBC Holdings Plc and Markit Economics said in an e-mailed statement. “The government-orchestrated slowdown in China” contributed to Citigroup Inc.’s decision to cut its forecast for copper prices in this year’s second half, analyst Alan Heap in Sydney wrote in a report today. He also cited “prospects of a stalled recovery in the developed economies (Europe in particular).” Copper will average $3.10 a pound ($6,834 a ton) in the half, 15 percent below its prior estimate, Citigroup said. The metal will average $3.29 next year, 9 percent less than predicted previously, according to the report. Concern about tighter monetary policy in China and the potential impact on demand of Europe’s fiscal crisis have helped to pull LME copper down 12 percent this year. Growth in Europe’s services and manufacturing industries slowed in June, Markit said, adding to signs a recovery is losing momentum. Services Gauge A composite index based on a survey of euro-area purchasing managers in both industries fell to 56 from 56.4 in May, Markit said. An index of services retreated to 55.5 from 56.2. A gauge of euro-area manufacturing declined to 55.6 from 55.8 in the previous month, Markit said on July 1. LME copper stockpiles fell to 444,500 tons, the lowest level since Dec. 2. Canceled warrants, as the bookings are known, slid 4.8 percent to 33,325 tons, the second drop in a row. Aluminum for three-month delivery on the LME advanced 0.6 percent to $1,948 a ton and lead rose 0.9 percent to $1,769 a ton. Nickel gained 1.5 percent to $19,086 a ton, zinc climbed 2.2 percent to $1,819 a ton and tin rose 0.2 percent to $17,270 a ton. To contact the reporter on the story: Anna Stablum in London at astablum@bloomberg.net.

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