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MF Global Daily Report: Base Metals (Sept. 7, 2011)
Sep 7,2011 10:32CST
industry news
Source:SMM
Metals were under pressure on Monday, with copper trading at a one-week low on the back of continued weak macro data.

Sept. 7 (MF Global) -- This market comment was written at 8:35 a.m. on September 6th, US east coast time...

Metals were under pressure on Monday, with copper trading at a one-week low on the back of continued weak macro data. In this regard, besides the weak service readings out of Europe referenced in Monday's note, Markit Economics said its Indian purchasing managers' index grew at its slowest pace in more than two years in August, while August Chinese service activity fell to a low of 50.6. Some support for copper arose from the supply side, where workers at Peru's Cerro Verde said they will launch a 48-hour strike starting tomorrow, while Freeport's mine workers in Indonesia have also threatened to strike on September 15. However, on balance, yesterday’s weaker tone in European equity markets, coupled with a struggling Euro and concern about the general global outlook, more than offset any supply-related issues. In addition, European debt concerns continue to be a source of angst; Italian bond yields rose to one-month highs yesterday, as pressure mounts on the government to get its fiscal house in order and get a credible austerity package passed. The suspension of an EU/IMF mission to Greece last week is also raising questions over where those negotiations stand, with the German finance minister bluntly warning the Greeks today that their next loan installment could be in jeopardy. In addition, markets are waiting for a ruling out tomorrow from a German high court on whether Berlin is breaking German and European law by contributing to multi-billion euro bailouts. Finally, there is an ECB rate decision out on Thursday, but this seems to have faded in terms of importance, as it is unlikely the central bank will decide to raise rates amid such a bleak environment.
 

base metals

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