SHANGHAI, Dec. 8 (SMM) –Pessimistic comments from a German official Wednesday depressed market expectations that the upcoming EU summit would yield a comprehensive plan for the euro zone's debt crisis, while further warnings from the Standard & Poor's (S&P) for the region kept market trading very cautious. As a result, LME copper prices slid in the session and touched a low at USD 7,743/mt. However, some optimistic investors slightly increased long positions after LME copper prices climbed to a high near USD 7,750/mt. Besides, US stock markets and the euro experienced technical rebounds, causing LME copper prices to pare some of the daily losses at the tail of trading. Finally, LME copper prices closed at USD 7,797/mt, down slightly by USD 62/mt, and positions for LME copper rose to above 300,000 lots. In recent trading days, transaction volumes on the LME and other commodity markets have fallen, highlighting market cautious sentiment before the result of EU summit and the release of economic data from China. Due to many uncertain factors and divergent views between Germany and France, the EU summit is unlikely to produce substantial measures.
The S&P placed the EU's long-term credit rating and credit ratings for some euro zone banks on negative watch list this morning, which will dampen the already weak trading sentiment today. Comex copper and crude oil prices fell this morning, which will weigh on commodity markets and Asian stock markets as well. Combined with cautious trading sentiment, LME copper prices are expected to move between USD 7,680 -7,850/mt during today's Asian trading hours. Chinese stock markets will continue to remain weak. SHFE copper prices will drift lower, and SHFE 1202 copper contract prices will fluctuate in the RMB 56,800 -57,800/mt range. Spot copper offers are estimated between discounts of negative RMB 100/mt and premiums of positive RMB 50/mt.