SHANGHAI, Jan. 18 (SMM) –The US and European markets continued to absorb upbeat economic data from China Tuesday, while a drop in borrowing costs on Spanish and Greek bond auctions also helped ease market worries over Europe's debt crisis. Buying force therefore appeared and pushed LME copper prices higher to USD 8,262/mt. However, as investors conducted profit-taking, the upside momentum waned for LME copper, which gradually narrowed daily gains and finally ended at USD 8,196/mt, posting less gains than other base metals excluding nickel.
The macroeconomic news front is relatively calm today. Despite positive result of Spanish and Greek bond sales, Standard & Poor's said it will downgrade credit ratings for more euro zone countries in the coming 4 weeks, becoming a potential risk for copper markets. Combined with growing upside resistance, LME copper prices will move between USD 8,050-8,250/mt during today's Asian trading hours, with limited upward room. Chinese stock markets will likely test resistance at 2,300 points following surges, which will restrain SHFE copper prices. Hence, SHFE 1204 copper contract prices are expected to fluctuate in the RMB 58,700 -60,000/mt range. Spot copper discounts are estimated between negative RMB 700-550/mt versus SHFE 1202 copper contracts.