SMM Morning Review - 2011/8/17 Copper Market

SHANGHAI, Aug. 17 (SMM) –German Federal Statistics Office overnight announced Germany's gross domestic product rose 0.1% in the second quarter, down from 1.3% in the first quarter, stoking fears over a global economic slowdown. Meanwhile, the meeting between French and German leaders failed to ease market sentiment. Due to uneven US economic data, US equity markets closed down, and the US dollar index closed higher due to risk aversion sentiment. As a result, LME copper prices moved downward and touched the lowest level for the week, with prices finally closing at USD 8,831/mt. Bearish sentiment seemed to be slightly up.

Copper prices on the Comex fell back in the morning session, and LME copper prices directly dropped below USD 8,800/mt after a low open. Furthermore, markets will continue to absorb yesterday's weak European growth data during Wednesday's Asian trading hours, weighing on LME copper prices, which are expected between USD 8,730-8,850/mt. In domestic markets, China's stock markets will open lower due to a drop in US equity markets, so SHFE three-month copper contract prices will follow LME copper prices to open down, and then moved lower, while SHFE 1111 copper contract prices will fluctuate in the RMB 65,700-66,500/mt range.