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Copper Pares Losses Amid Mixed US Data
Apr 20,2012 08:42CST
industry news
Source:SMM
Copper futures pared earlier losses, but finished in negative territory, as investors weighed mixed signals from U.S. economic data.

Apr 19, 2012 NEW YORK (Dow Jones)--Copper futures pared earlier losses, but finished in negative territory, as investors weighed mixed signals from U.S. economic data.

Copper for May delivery, the most actively traded contract, settled down 0.35 cent, or 0.1%, at $3.6275 a pound on the Comex division of the New York Mercantile Exchange.

In a sign that the U.S. economy is again losing jobs, the four-week moving average of U.S. initial jobless claims rose by 5,500 to a seasonally adjusted 374,750. This was the highest level since Jan. 28. The moving average smoothes out weekly volatility. 

Sales of previously owned homes in the U.S. fell in March for the second straight month and missed expectations. However, the index of leading economic indicators in March posted the sixth increase in a row and outpaced economists' forecasts.

Copper traders tend to keep a close eye on economic news as demand for industrial metal tends to fall when business activity, especially in manufacturing and construction, slows down.

"I think that the copper market is beginning to reflect that the global economy is really not doing all that well," said Sterling Smith, analyst at Country Hedging.

China's copper imports are set to reach a record of 5.5 million tons, said VTB Capital's global head of commodities Wiktor Bielski. The recent pessimism about Chinese growth has been exaggerated, Bielski said, and demand economic indicators in China point to strong ongoing demand for commodities, including copper.

"China is stronger than most people realize," Bielski said on the sidelines of the VTB Capital conference here. "Growth in China has been only marginally below what we saw in 2011 and certainly significantly above what you'd expect reading all the negative news."

China is the world's largest consumer of copper, accounting for about 40% for output.

Elsewhere, Freeport-McMoRan Copper & Gold Inc., the world's largest listed copper mining company, reported first-quarter earnings fell 49% to $764 million on impacts from labor-related disruptions at its Indonesian mining operations.

Copper settlements (ranges include electronic and pit trading):
Apr $3.6265; down 0.15 cents; Range $3.6175-$3.6280
May $3.6275; down 0.35 cents; Range $3.5975-$3.6550

 

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