SHANGHAI, Feb. 6 (SMM) –LME copper prices continued to fluctuate during early US and European trading session last Friday. The US economic report in the evening revealed that US non-farm payrolls rose by 243,000 in January, well above market expectations, while the jobless rate in January fell to a 3-year low of 8.3%, heightening investor confidence about a continuous recovery in the US economy. In response, US equities closed with strong gains, with the Nasdaq Composite Index jumping to an 11-year high. LME copper prices also surged and finally ended at a recent intraday high of USD 8,595/mt, up USD 266/mt. Nevertheless, it is worth noticing that trading volumes last Friday decreased sharply compared with the previous trading day, suggesting investor doubts that copper prices can remain high continuously.
LME copper prices will easily suffer profit-taking from Asian investors at above USD 8,500/mt while new short investors will probably build up positions. Besides, Comex copper prices slipped this morning owing to an increasing US dollar index, meaning any upside room for LME copper will be limited today. Therefore, LME copper prices are expected to move between USD 8,430 -8,600/mt during today's Asian trading session. Chinese stock markets will open higher and test support at the 60-day moving average. SHFE copper prices will open higher and then have limited upside room, tracking fluctuations in LME copper prices, while SHFE 1204 copper contract prices will fluctuate in the RMB 59,800-61,400/mt range. Spot copper discounts are estimated between negative RMB 350-200/mt against SHFE 1202 copper contracts.