SHANGHAI, Sept. 2 (SMM) –The European and American markets overnight continued to digest China's official manufacturing PMI data, but traders saw signs of problems for the country's future export growth. Meanwhile, from the PMI data released by some Euro-zone countries, the manufacturing activity in the Euro-zone area for August suffered contraction due to significant drops in manufacturing output and new orders for the first time in nearly two years, stoking market concerns about the health of global economy. In this context, the euro slumped, and the US dollar advanced, reaching a high of 74.714. Besides, investors kept cautious before the release of the US employment data on Friday, propelling LME copper prices to move upward and test the support at USD 9,100/mt during the trading hours. At the tail of trading, data released by the US Institute for Supply Management (ISM) showed the US ISM manufacturing index was 50.6 in August, better than market expected. As a result, LME copper prices pared the daily declines, with prices finally closing at USD 9,145/mt, down more than USD 100/mt.
During Friday's Asian trading hours, the US dollar is not likely to rebound further after the previous day's big gains. Together with news on Friday morning that Obama has significantly cut the forecast for US economic growth, the US dollar will face downward pressures, which will support LME copper prices. Copper prices on the Comex rallied during Friday's morning session, and investors will keep cautious before the US non-farm payrolls are announced Friday evening. Therefore, LME copper prices are expected to move between USD 9,080-9,220/mt. In Chinese markets, Chinese stock markets will open lower after US equity markets closed down on the prior day. Hence, the longs and shorts will struggle at RMB 68,000/mt after the SHFE copper market opens, while SHFE 1111 copper contract prices will move in the RMB 67,700-68,500/mt band.