RTRS:METALS-Copper rises as China's Wen offers euro zone support
* Wen confident of euro zone surviving debt crisis
* Signs of pickup in Chinese spot copper demand wanes
* Coming up: U.S. personal income/spending; 1230 GMT
By Carrie Ho
SHANGHAI, Aug 30 (Reuters) - Copper edged higher on Thursday
after three straight sessions of losses, buoyed by Chinese
Premier Wen Jiabao's support for the euro zone, which helped
boost investor confidence in the global economy and the outlook
for metals demand.
After meeting German Chancellor Angela Merkel on Thursday,
Wen said he was confident the euro zone could pull out of its
debt crisis.
He also said China was willing to buy more EU government
bonds if it could assess the risks involved, the strongest sign
of support for its biggest trading partner in recent
months.
"Copper prices started turning around after the meeting
between Wen and Merkel. Investors feel reassured," said a
Shanghai-based trader with an international firm.
Traders said Wen's comments helped offset some of the
bearishness which pervaded the market after China's top planning
agency said the economy was slowly stabilising, dashing hopes
for more aggressive stimulus measures by the
government.
But major gains are unlikely as investors are waiting for
Friday's speech by Federal Reserve Chairman Ben Bernanke, who is
expected to provide hints of a third round of quantitative
easing at the Jackson Hole, Wyoming, meeting of central
banks.
Three-month copper on the London Metal Exchange was
up 0.7 percent at $7,630 per tonne by 0818 GMT, snapping three
sessions of losses.
The most active December copper contract on the Shanghai
Futures Exchange climbed 0.9 percent to 55,680 yuan
($8,800) per tonne, on track to reverse two sessions of losses.
Copper has fallen as hopes for rate cuts or a reduction to
bank reserve requirements in China fade as Beijing seems
reluctant to resort to blunt monetary policy instruments and is
instead experimenting with more delicate tools, such as
injecting liquidity into the interbank market.
Physical demand for copper also slackened in China, the
world's top consumer of the refined metal.
The premium for China's spot copper price over the prompt
September month contract narrowed to 45 yuan on
Wednesday, state-backed research firm Minmetal Futures said a
note on Thursday. Premiums were at around 100 yuan last week.
The narrowing spread is a sign that the recent spurt of spot
purchases by smelters and speculators has failed to prop up the
market amid poor demand from copper end-users, traders said.
Separately, China's biggest copper smelter Jiangxi Copper
said its first half profit fell 38 percent.
Base metals prices at 0818 GMT
Metal Last Change Pct Move YTD pct chg
LME Cu 7630.00 55.00 +0.73 0.39
SHFE CU FUT DEC2 55680 470 +0.85 0.09
LME Alum 1896.00 3.00 +0.16 -6.14
SHFE AL FUT DEC2 15390 -15 -0.10 -2.84
HG COPPER SEP2 346.65 2.40 +0.70 0.89
LME Zinc 1866.00 10.00 +0.54 1.14
SHFE ZN FUT DEC2 14790 20 +0.14 -0.03
LME Nickel 16416.00 116.00 +0.71 -12.26
LME Lead 1974.25 -1.75 -0.09 -2.99
SHFE PB FUT 15225 55 +0.36 -0.43
LME Tin 19475.00 -145.00 -0.74 1.43
LME/Shanghai arb 989
Shanghai and COMEX contracts show most active months
^ LME 3-m copper in yuan, including 17 pct VAT, minus SHFE
third month
