RTRS:METALS-Copper treads water on investors' caution
* Investors' caution keeps copper in narrow range
* Coming Up: U.S. Case-Shiller 20 mm nsa, Feb; 1300 GMT
(Updates prices, adds quotes, details)
By Carrie Ho
SHANGHAI, April 24 (Reuters) - Copper was largely flat on
Tuesday as political uncertainty and lacklustre economic data in
Europe kept investors on the sidelines waiting for clearer price
signals in a market dulled by China's high stockpiles and weaker
than expected demand.
The price of the financially-sensitive red-metal has come
under pressure this month, shedding nearly 4.5 percent as fears
resurfaced over the euro zone's debt woes.
Three-month copper on the London Metal Exchange rose
0.2 percent to $8,057.25 a tonne by 0407 GMT, after falling
nearly 1.8 percent on Monday.
The most-active July copper contract on the Shanghai Futures
Exchange crept up 0.1 percent to 57,400 yuan ($9,100) a
tonne, after falling 0.7 percent in the previous session.
"We are stuck somewhere in the middle of a technical range
where the shorts don't want prices to be any higher and longs
don't want prices to be any lower," said an LME trader.
"So prices are moving within tiny ranges again today, but
with significant downside waiting to be triggered by the next
negative event. One data item I'm looking out for are the final
Chinese PMI numbers."
A final reading of the China HSBC Purchasing Managers Index
(PMI) will be released on May 2, following preliminary results
released on Monday.
The HSBC PMI data suggested industrial activity in the
world's second largest economy picked up in April from March,
but this was not big enough to trigger buying of risk assets as
it stayed under 50, signifying contracting economic activity.
But the euro zone's financial woes continue to keep
investors on their toes. The region's business slump deepened at
a far faster pace than expected in April, suggesting the economy
will stay in recession at least until the second half of the
year.
Weak demand from crisis-stricken euro zone countries is also
hurting the recovery of Europe's largest economy, Germany, the
Bundesbank said on Monday. Germany's economy shrank 0.2 percent
in the fourth quarter, but many economists expect it to steady
in the first quarter.
On the political front, Dutch Prime Minister Mark Rutte on
Monday unexpectedly tendered his government's resignation in a
crisis over budget cuts, creating a political vacuum in one of
the euro zone's most stable nations.
In France, the result of the first round of the presidential
election, which showed Socialist candidate Francois Hollande
marginally ahead of incumbent Nicolas Sarkozy, also threatened
to hamper the euro zone's efforts to contain the debt crisis.
"I'm eyeing the French elections since a change in the
government may weaken France's support to the euro zone's
efforts to help more indebted member economies. This may deepen
uncertainties over the health of the global economy," said China
Futures Co. analyst Yang Jun.
Separately, increased domestic production drove implied
consumption of refined copper in China, the world's top consumer
of the metal, up 1 percent in March from a month earlier,
according to Reuters calculations based on official customs data
released on Monday.
Base metals prices at 0407 GMT
Metal Last Change Pct Move YTD pct chg
LME Cu 8057.25 12.25 +0.15 6.02
SHFE CU FUT JUL2 57400 70 +0.12 3.18
LME Alum 2066.00 8.00 +0.39 2.28
SHFE AL FUT JUL2 16110 20 +0.12 1.70
HG COPPER MAY2 363.90 1.30 +0.36 5.91
LME Zinc 1994.75 6.75 +0.34 8.12
SHFE ZN FUT JUL2 15455 -25 -0.16 4.46
LME Nickel 17622.00 72.00 +0.41 -5.82
LME Lead 2072.00 6.00 +0.29 1.82
SHFE PB FUT 15720 -10 -0.06 2.81
LME Tin 21375.00 130.00 +0.61 11.33
LME/Shanghai arb 2073
Shanghai and COMEX contracts show most active months
^ LME 3-m copper in yuan, including 17 pct VAT, minus SHFE
third month
