Copper Falls On Growth Worry; Down 2.7% In Week

May 04, 2012 NEW YORK (Dow Jones)--Copper futures fell on Friday, capping off a weekly decline, as investors bet that the recent set of disappointing global economic data pointed to lower demand for the industrial metal.

On Friday, the U.S. government's closely watched tally of unemployment came in well short of expectations, the latest sign that growth in the world's largest economy may be slowing after a hot start to the year.

The U.S. economy added 115,000 jobs in April, the Labor Department reported. Economists had expected a gain of 168,000.

The most actively traded copper contract, for July delivery, fell 1.5 cents, or 0.4%, to settle at $3.721 a pound on the Comex division of the New York Mercantile Exchange.

During the week, futures fell 2.7%. Separate reports this week showed the manufacturing sectors in China and the euro zone continued to shrink in April. Copper is sensitive to the economic outlook because of its widespread use in power cables, construction and general manufacturing.

"Concern about Europe's debt problems, slowing growth in China and the health of the U.S. economy continue to plague the base metals," traders with RBC Capital Markets said in a note.

Bullish investors had pushed copper prices to a four-week high in thin trading on Tuesday, betting that tight supplies, combined with the chance that central banks in China and the U.S. will respond to slowing growth by deploying new stimulative measures, would support the market.

But futures fell for the following three days after readings on Chinese and European manufacturing cast doubts on the prospects for copper consumption in the near term.

"You have two camps, and neither is giving up," said Adam Klopfenstein, a market strategist with Archer Financial Services, of copper's initially indecisive reaction to Friday's U.S. jobs data. "It's a tough trade in copper."

The U.S. economy was surprisingly strong to start the year, blunting the impact of slowing growth in top copper consumer China and outright economic contraction in the euro zone.

Copper settlements (ranges include electronic and pit trading):
May  $3.7240; down 0.95 cent; Range $3.7055-$3.7535
July $3.7210; down 1.50 cent; Range $3.7025-$3.7550