Home / Metal News / Zinc / Comex Copper Slips On Europe, China Growth Worry
Comex Copper Slips On Europe, China Growth Worry
Feb 23,2012 09:08CST
industry news
Copper futures ticked lower Wednesday, settling with slight losses on caution about demand prospects for the red metal as investors weighed weak economic data from Europe and China.

Feb 22, 2012 NEW YORK (Dow Jones)--Copper futures ticked lower on Wednesday, settling with slight losses on caution about the demand prospects for the industrial metal as investors weighed weak economic data from Europe and China.

The most actively traded copper contract, for March delivery, fell 0.3 cent, or 0.1%, to settle at $3.8335 a pound on the Comex division of the New York Mercantile Exchange.

"Copper traders are rightly looking at copper still as more of a risky industrial play" because of worries about global growth, said Bob Haberkorn, senior commodities broker with RJO Futures.

A Wednesday reading showed that euro-zone business activity contracted unexpectedly in February, underlining the concern that despite the recent Greek bailout deal, the continent's economy may still struggle to grow. Markit Economics' purchasing managers index fell to 49.7 in February, from January's 50.4. Readings below 50 indicate contraction.

Copper is sensitive to such economic data because of its widespread uses across industries, including plumbing, autos and consumer electronics.

Other market participants were worried about demand from top metals consumer China, after a preliminary gauge of the country's manufacturing activity in February again showed contraction.

"Chinese copper demand has waned in the last two weeks," Europe's largest copper producer, Aurubis, said in a market outlook on Wednesday.

But the company said it expects the weakness in Chinese demand to be temporary as the second quarter brings a seasonal boost to consumption.

Many market watchers are also expecting Beijing to ease its grip on credit in the coming months, making it easier for manufacturers to finance metals purchases. Copper prices were boosted on Tuesday after the country's central bank over the weekend announced a decrease in the amount of cash banks must hold in reserve.

Also Wednesday, operations at Dona Ines de Collahuasi's copper mine resumed after a stoppage following the death of a worker at the mine's concentrator plant on Tuesday. The mine is one of the world's largest, accounting for about 3% of global mine production, according to estimates from the company and metals analysts at Deutsche Bank.

Copper settlements (ranges include electronic and pit trading):
Mar $3.8335; down 0.30 cent; Range $3.7940-$3.8515
May $3.8425; down 0.20 cent; Range $3.8030-$3.8590



For queries, please contact Frank LIU at liuxiaolei@smm.cn

For more information on how to access our research reports, please email service.en@smm.cn

Related news