SHANGHAI, Jul. 22 (SMM) –The European and American markets overnight continued to absorb weak economic data in China, and investors feared China would further take tightening monetary measures. Besides, the PMI data in the Euro-zone area was also weak, only 50.4, pressuring LME copper prices to fall from their previous gains. In response, LME copper prices lowered to test USD 9,600/mt, and lost the 5 and 10-day moving averages. The EU Summit overnight reached an agreement, helping the euro increase significantly. Later the evening, the US deficit reduction and debt ceiling plans were opposed by Republicans, sending the US dollar index down below 74 points. Meanwhile, the US announced the Philadelphia Fed's manufacturing index was 3.2 in July, better than market expectations and the previous data, causing all US equities to close higher, and also helping support the low-end LME copper prices. As a result, LME copper prices closed at USD 9,642/mt.
During Friday's Asian trading hours, concerns over a contagion of the European debt crisis remain, although market worries have eased from the reached agreement on Greece's bailout plans. In this context, the euro is expected to make corrections after reporting profit-taking at highs. The US dollar index will stop from its early losses and close slightly higher. Given resistance at USD 9,700/mt, as well as the 5 and 10-day moving averages, LME copper prices will move between USD 9,610-9,710/mt. In domestic market, SHFE copper prices will open more than RMB 400/mt lower, and the longs will close positions near RMB 72,000/mt. SHFE 1110 copper contract prices will move between RMB 71,600-72,300/mt.