SG:London copper dips to one week low on China holiday
Reuters reported that London copper sank to its lowest in more than a week due to ample supply and tepid buying interest, with markets in top consumer China closed for a holiday.
Mr Jonathan Barratt of Barratt's Bulletin in Sydney said that “Worries about demand growth in China have waned in recent days as prospects for more stimulus have been priced in, lending support to copper. However prices are still at risk of succumbing to souring economic sentiment, especially if equity markets falter. If negative equity sentiment prevails, that might overflow into other sectors of the economy then people will start to lose confidence."
The US Nasdaq exchange had its worst day since February on Friday, leaving investors anxious about how much further shares may fall. Three month copper on the London Metal Exchange slipped by 0.4% to USD 6,590 per tonne by 0228 GMT, widening small losses from the previous session.
Copper earlier fell to its weakest since March 28 at USD 6,585.25 per tonne, juddering back towards three and a half year lows of USD 6,321 per tonne touched on March 19.
Chinese markets including the Shanghai Futures Exchange were closed on Monday for tomb-sweeping day. Markets will reopen on Tuesday. China will probably need to ease monetary policy for the first time in two years in coming months to prevent the economy from losing too much momentum.
Asian markets were torn on Monday, some following Wall Street lower but others encouraged by US jobs data that hit the sweet spot for many investors firm enough to soothe concerns about the health of the US recovery but not so strong as to hasten the end of policy stimulus.
US employers hired at a brisk pace last month and ramped up the hours their workers put in on the job, the strongest signals yet the economy was breaking free of its winter doldrums.
According to data from the Commodity Futures Trading Commission, reflecting a slightly less bearish view on the economy, hedge funds and money managers trimmed their net shorts in copper in the week to April 1.
On the supply side, China's Chinalco Mining Corp partially resumed output at its new Toromocho copper mine in Peru on Friday after suspending all operations for a week to comply with a government order that cited the company for pollution.
The Lisbon based International Nickel Study Group, the global nickel surplus will shrink to about 50,000 tonnes this year on stronger than expected demand and as an export ban on nickel ore by top producer Indonesia takes hold.
