SHANGHAI, Feb. 6 (SMM) –As LME copper prices remained weak overnight, SHFE 1204 copper contract prices, the most active one, opened RMB 360/mt lower at RMB 59,500/mt Friday, and fluctuated around this price mark after the opening. Short investors then made profit-taking, helping SHFE three-month copper contract prices move higher. In the afternoon business, as Chinese stock markets reversed declines and increased by 1%, and as LME copper prices rallied to near USD 8,400/mt, SHFE three-month copper contract prices rose but still met resistance at RMB 60,000/mt. Owing to position closings at the tail of trading, SHFE three-month copper contract prices lost support and retreated to early trading session levels, with an intraday high at RMB 60,060/mt. Finally, SHFE 1204 copper contract prices closed at RMB 59,820/mt, down RMB 40/mt or 0.07%. Positions for SHFE 1204 copper contracts were down 9,568 lots, and trading volumes were down 90,464 lots. SHFE copper prices would continue to fluctuate due to great pressures at the 5- and 10-day moving averages. 

In the spot market, as SHFE copper prices moved higher after a low open, buying activity for spot copper was brisk at low price levels in the morning business. Cargo-holders, though, had no intention of selling aggressively due to expectations about improvement in copper consumption next week, and narrowed copper discounts to between negative RMB 320-180/mt in the morning business. Traded prices for standard-quality copper were between RMB 58,700-58,900/mt in the morning business, and RMB 58,780-59,050/mt for high-quality copper. Both downstream producers and traders appeared more willing to buy during the whole trading day, helping market activity become the most active following the Chinese New Year holidays. In the afternoon session, although SHFE copper prices fluctuated at high levels, spot copper discounts were virtually unchanged from the morning business levels, while traded prices rose to between RMB 58,900-59,100/mt. Trading sentiment in the afternoon business was lower than that in the morning session. Copper inventories monitored by the Shanghai Futures Exchange increased by 48,246mt to 179,891 mt in the week ending February 3rd, highlighting sluggish consumption due to the Chinese New Year holiday, which would restrict copper prices over the near term.