NEW YORK—Copper futures retreated after the previous day's steep rally, as downbeat readings on Chinese and euro-zone manufacturing sent investors cashing out of the industrial metal.
The most actively traded copper contract, for December delivery, was down 2.55 cents, or 0.7%, at $3.55 a pound in early trade on the Comex division of the New York Mercantile Exchange.
Copper had climbed to a three-week high Wednesday after six of the world's major central banks announced steps to lower dollar borrowing costs to stabilize the global financial system. The joint effort eased concerns that the euro zone was sliding toward a credit crunch that would slash industrial activity.
Copper is used in a wide range of applications in construction and manufacturing, making prices sensitive to the economic outlook.
"Such heights being gained yesterday, it is hardly surprising we are seeing profit-taking this morning," analysts with Commerzbank said in a note, adding that prices were also under pressure from a contraction in the manufacturing sector of top consumer China.
China's gauge of manufacturing-sector activity showed contraction in November for the first time since February 2009, tempering demand expectations for copper.
A reading on euro-zone manufacturing also showed activity contracted in November, coming in at a 28-month low. The European Union is the world's second-largest copper consumer.
Copper extended its losses after U.S. weekly jobless claims unexpectedly rose last week, a bearish signal ahead of Friday's closely watched monthly reading on unemployment in the world's largest economy.
