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Copper Declines After German Factory Orders Signal Growth May Be Slowing
Sep 9,2010 09:46CST
industry news
Source:SMM
copper futures dropped on the LME market after order declines in German

Sep 8 (Bloomberg)--

Copper dropped for a second day after an unexpected decline in German factory orders signaled growth may be slowing in Europe’s biggest economy.

The three-month delivery contract on the London Metal Exchange fell as much as 0.8 percent to $7,569 a metric ton and traded at $7,596 at 11:50 a.m. in Singapore. Copper for December delivery on the Shanghai Futures Exchange lost as much as 0.6 percent to59,320 yuan ($8,726) a ton, before trading at 59,680 yuan at 11:30 a.m. local-time trading break.

"Uncertainties about the global macro-economic environment never went away and the markets get a reminder every time economic data comes out worse than expected,” Zhang Xi, an analyst at Luzheng Futures Co., said from Shandong today.

"Copper shouldn’t rally in August because it’s a traditionally slow demand period, but the entry of speculative money overrode the fundamentals,” said Zhang. "Prices tend to rise in September and October and now that the rally has been brought forward, gains will be limited from here.”

Factory orders in Germany, adjusted for seasonal swings and inflation, declined 2.2 percent in July from June, the Economy Ministry said yesterday, compared with a 0.6 percent advance forecast by economists.

A separate report today is expected to show that German exports stagnated in July, according to a Bloomberg News survey, indicating the country’s economy may be losing momentum.

China Industrial Output

In China, the biggest consumer of copper, the Ministry of Industry and Information Technology said in a briefing yesterday that the country’s slowdown in industrial production growth will deepen in coming months, with output to gain about 10 percent in the second half of 2010 from a year earlier, compared with the 17.6 percent average for the first half of this year.

Economists expect the jobless rate in the U.S. to approach 10 percent in the coming months, after private payrolls climbed less than expected in August. The Federal Reserve releases its Beige Book business survey today, which may add to evidence the recovery is stalling.

Aluminum in London fell 0.4 percent to $2,157 a ton, zinc dropped 0.3 percent to $2,183 a ton and lead fell 1.1 percent to $2,161 a ton. Nickel lost 0.5 percent to $22,090 a ton and tin gained 0.7 percent at $21,100 a ton at 11:53 a.m. in Singapore.

               
      


 


 

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