Aug 27 (Bloomberg)--
Copper gained, headed for a second weekly advance, on optimism that demand will improve in China, the world’s largest user, as the weak consumption season ends. Prices rose to a one-week high in Shanghai.
Copper for three-month delivery on the London Metal Exchange added 0.3 percent to $7,325 a metric ton at 3:32 p.m. in Singapore, a 1 percent gain this week. The metal fell as much as 0.8 percent earlier amid concerns that the global economy is faltering.
"The market will consolidate at these high prices until a clearer consumption picture emerges in the fourth quarter,” said Luo Dayun, a trader at China Rising Futures Co.
"Recent data highlights the uncertainties that still exist in the economy and this will keep rallies in check,” Luo said from Beijing today. “Once prices go up, price-sensitive Chinese buyers will start to make hand-to-mouth purchases, so support from the physical market is reduced.”
The December-delivery contract on the Shanghai Futures Exchange gained for a second day, rising as much as 0.9 percent to 57,870 yuan ($8,512) a metric ton before settling at 57,830 yuan.
The Federal Reserve Bank of Kansas City said yesterday that manufacturing growth stalled in the region, while the Spanish government may see a delay of “a few hundred million euros” in tax revenue after a court ruled its method of auditing sales tax was illegal, triggering losses in equities.
The benchmark MSCI Asia Pacific Index reversed an earlier loss of as much as 0.4 percent on optimism over corporate earnings and as Japan pledged “appropriate” action to curb the yen’s gains. The gauge is still heading for a weekly decline.
Zinc in London rose 0.2 percent to $2,055 a ton, lead gained 1 percent to $2,045 a ton and nickel climbed 1.7 percent to $20,798 a ton. Aluminum added 0.4 percent to $2,031 a ton, while tin jumped 1.6 percent to $21,700 a ton.