RTRS:METALS-Copper eyeing smallest weekly gain in a month
* Copper steady after nearly 14 pct gain year to date
* Chinese copper importers delay shipments-traders
* Coming Up: US ISM-New York index, 1445 GMT
(Updates prices)
By Manolo Serapio Jr
SINGAPORE, March 2 (Reuters) - Copper steadied on
Friday and is headed for its smallest weekly gain in a month as
concerns about slow demand from top consumer China persisted
despite data showing the Chinese economy is regaining momentum.
The industrial metal has gained nearly 14 percent so far
this year, benefitting like other risk assets from increased
liquidity across markets as countries ease credit conditions to
spur economic growth.
But investors have struggled to push prices even higher,
with Chinese demand remaining slack.
Three-month copper on the London Metal Exchange
was little changed at $8,640 a tonne by 0704 GMT after
closing at $8,630 on Thursday.
Copper is heading for its second straight weekly gain, which
at 1.3 percent so far would be the smallest weekly rise since
early February.
Data released on Thursday that showed an index measuring
China's manufacturing activity at a five-month high calmed
worries about an economic slowdown. However, some analysts say
copper will remain trapped in narrow ranges unless Chinese
demand perks up.
"Copper is a flat story at the moment. Chinese demand used
to be the driver, but now it looks like it's a dragger," said
Henry Liu, head of commodity research at Mirae Asset Securities
in Hong Kong.
Importers of refined copper in China have delayed some
February-March shipments and diverted some cargoes to South
Korea due to weak demand, traders said.
"Traders still have doubts over demand growth in China
without further credit easing from the government," Sucden
Financial Industrial Commodities said in a note.
China cut banks' reserve requirement ratio for the first
time in February this year to spur economic growth and
economists expect more easing.
But, given the increased liquidity in markets, many
investors are still betting on copper prices to rise versus
other base metals, given that it remains a tight market, while
others like aluminum and nickel are oversupplied.
Global miner Rio Tinto said it expects the
copper market to stay tight despite growth in supply,
anticipating rising costs and supply disruptions to continue
following labour strikes last year.
The most-traded May copper contract on the Shanghai Futures
Exchange rose 1.7 percent to 61,330 yuan ($9,700) a
tonne at the close, tracking the LME's gains in the
previous session.
While Chinese manufacturing is growing, factory activity
cooled in the United States in February and consumer spending
was flat for a third straight month in January, suggesting the
economy lost more steam early this year than expected.
Manufacturing activity in the euro zone continued to
contract, although the International Monetary Fund said the
probability of a sharp global slowdown had eased due to recent
policy measures adopted in the euro zone to tackle its debt
crisis.
Base metals prices at 0704 GMT
Metal Last Change Pct Move YTD pct chg
LME Cu 8640.00 10.00 +0.12 13.68
SHFE CU FUT MAY2 61330 1040 +1.72 10.78
HG COPPER MAY2 393.60 0.45 +0.11 14.55
LME Alum 2360.00 7.00 +0.30 16.83
SHFE AL FUT MAY2 16270 75 +0.46 2.68
LME Zinc 2119.00 14.00 +0.67 14.85
SHFE ZN FUT MAY2 16075 185 +1.16 8.65
LME Nickel 19765.00 265.00 +1.36 5.64
LME Lead 2181.00 18.00 +0.83 7.17
SHFE PB FUT 16210.00 160.00 +1.00 6.05
LME Tin 24000.00 225.00 +0.95 25.00
LME/Shanghai arb^ 2331
Shanghai and COMEX contracts show most active months
^ LME 3-month copper in yuan, including 17 pct VAT, minus SHFE third month
