* Copper up 0.5 pct in London, down 0.03 pct in Shanghai
* Copper rises, rebounding from nine-month low
* Investors eyeing announcement after Fed meeting on
Wednesday
(Updates prices, adds comments)
By Jane Lee
SINGAPORE, Sept 21 (Reuters) - London Metal Exchange copper
rose as Chinese buyers took advantage of the lowest price in
nine months to stock up on the metal.
Economic worries continue to weigh on copper ahead of the
result of a U.S. Federal Reserve meeting later on Wednesday that
could see more monetary easing in the world's largest economy,
after the International Monetary Fund warned about growth.
"The economy is still the general concern and the negative
sentiment remains but China is restocking," said Jonathan
Barratt, managing director for Commodity Broking Services in
Sydney.
The Shanghai front-month October contract SCFc1 is trading
at a 440-yuan premium to the most active December contract,
indicating some restocking by copper users.
Three-month copper on the London Metal Exchange
climbed 0.5 percent to $8,353.25 a tonne by 0700 GMT, after
dropping 0.7 percent in the previous session. Prices fell as low
as $8,238 on Wednesday, the lowest since Nov. 30.
The most-active December copper contract on the Shanghai
Futures Exchange SCFc3 edged down 0.03 percent to 62,940 yuan
($9,859) per tonne.
LME copper is at a 611 yuan ($96) per-tonne discount to
Shanghai copper, taking into account 17 percent VAT, encouraging
arbitrage trade. The discount widened from 234 yuan at 0706 GMT
on Tuesday.
China's refined copper imports CU-CNREFIMP rose 32 percent
in August from July to 235,509 tonnes, but fell 12 percent from
a year earlier.
ECONOMY WEIGHS
The IMF reduced its prediction for global growth this year
and next, saying the U.S. and European economies could slip back
into recession.
The latest IMF report "added to the pessimistic outlook for
global copper consumption in the second half of the year,"
Phillip Futures said in a report.
Copper in London is expected to fall below $8,190 per tonne,
while Shanghai copper's bearish target at 61,030 yuan per tonne
is unchanged, according to Wang Tao, a Reuters technical
analyst.
Markets are focusing on a two-day Federal Open Market
Committee meeting expected to end Wednesday with a decision to
purchase longer-term U.S. Treasury debt, a move that would force
interest rates lower and could weaken the dollar.
The other major factor for markets is whether Europe can
pull of its debt crisis. Recent news hinted at Beijing backing
away from the idea of snapping up euro zone debt, after a former
adviser to China's central bank said on Wednesday that China
should refrain from buying European government bonds.
Greece's negotiations to qualify for its next aid package
and the threat of the debt crisis spreading in the euro zone are
clouding the outlook for industrial metal demand.
European stock index futures fell on Wednesday and the
dollar edged up against a basket of currencies before a
possible Fed announcement of a stimulus plan.
A strike at Freeport-McMoRan Copper and Gold Inc's Grasberg
mine in Indonesia has slowed production "significantly," chief
executive officer Richard Adkerson told CNBC on Tuesday.
Base metals prices at 0700 GMT
Metal Last Change Pct Move YTD pct chg
LME Cu 8353.25 44.25 +0.53 -12.99
SHFE CU FUT DEC1 62940 -20 -0.03 -12.40
LME Alum 2335.00 8.00 +0.34 -5.47
SHFE AL FUT NOV1 17290 95 +0.55 2.67
HG COPPER DEC1 377.15 4.60 +1.23 -15.05
LME Zinc 2108.00 26.00 +1.25 -14.10
SHFE ZN FUT DEC1 16455 75 +0.46 -15.51
LME Nickel 21300.00 80.00 +0.38 -13.94
LME Lead 2333.00 13.00 +0.56 -8.51
SHFE PB FUT OCT1 15800 50 +0.32 -13.90
LME Tin 22710.00 60.00 +0.26 -15.58
LME/Shanghai arb -611
Shanghai and COMEX contracts show most active months
^ LME 3-m copper in yuan, including 17 pct VAT, minus SHFE
third month
($1 = 6.384 Chinese Yuan)
(Additional reporting by Carrie Ho in SHANGHAI; Editing by
Michael Urquhart)
