SHANGHAI, Oct. 11 (SMM) –Leaders of France and Germany Monday pledged a new comprehensive plan to find a sustainable solution to the reorganization of euro-zone banks and the escalating debt crisis in this region, comforting some market investors and helping the Euro register the biggest daily gain in more than one year. In response, the US dollar index fell to above 77, improving risk appetites and leading US equity markets to close more than 3% higher. Capitals returned to the markets, and LME copper prices fluctuated higher, climbing as high as USD 7,500/mt and finally ending at USD 7,478/mt. Data revealed that LME copper inventories were down 4,575 mt to 462,525 mt, and inventories in South Korea also fell significantly. However, it's worth noticing that LME copper prices rebounded nearly 13% from a 13-month low below USD 6,700/mt in the past week, but trading volumes were not high during the four consecutive rising days. Furthermore, Chinese investors were also wary of buying on the first trading day after China's National Day holiday, so this round of increases are likely technical corrections.
Alleviation in Europe's debt issue will support the Euro's movements today. Nevertheless, German spokesman said this morning the move of Germany and France couldn't solve European debt crisis fundamentally. Moreover, LME copper prices are expected to meet a wave of selling at above USD 7,500/mt, so SMM believes LME copper prices will move between USD 7,350 -7,500/mt during today's Asian trading hours, with limited continuous rebounding room. Chinese stock markets will open higher today due to a lift by rising US equity markets overnight. SHFE copper prices will meet great resistance at RMB 56,000/mt after opening higher, while SHFE 1112 copper contract prices will fluctuate in the RMB 55,000-56,100/mt range.