May 22, 2012 NEW YORK (Dow Jones)--Copper futures lost ground Tuesday, as mixed economic reports from the U.S. struggled to offset worries about the upcoming European Union summit in Brussels.
The most actively traded contract, for July delivery, fell 1.50 cents, or 0.4%, to settle at $3.4870 a pound on the Comex division of the New York Mercantile Exchange.
Copper prices caught a temporary boost shortly after 10 a.m. ET, as traders weighed the impact of two separate measures of the U.S. economy.
Sales of previously owned homes in the U.S. increased 3.4% in April from a month earlier. The construction sector is a major source of copper demand, as copper plumbing, electrical wiring and roofing is used in building residential and commercial buildings.
The Federal Reserve Bank of Richmond said manufacturing activity slowed in the region, with the bank's manufacturing general-business index falling to 4 from 14 in April. Readings above zero indicate expanding activity. The Richmond Fed survey covers businesses in Washington, D.C., North Carolina, South Carolina, Virginia and most of West Virginia.
Trader attention has now turned to the EU summit due to begin in Brussels Wednesday. European leaders are due to discuss measures to boost growth and employment, though the region's struggle with debt is another subject likely to be breached.
"With the overall angst surrounding Europe, I don't think it's going to take a lot of negative news from markets to send prices lower," said Bill O'Neill, a principal with Logic Advisers.
Elsewhere, commodities giant Glencore International PLC (GLNCY, GLEN.LN) said it struck a $480 million deal to boost its stake in a Congolese copper and cobalt mine called Mutanda, making its first significant step in a plan to merge the asset with its adjacent Kansuki mine.
Mutanda is located in Central Africa's copper belt, where Glencore already owns indirect interest in copper operations through its majority stake in Congolese mining company Katanga Mining Ltd. (KATFF, KAT.T). Mutanda has high ore grades and low production costs and is one of Glencore's key growth assets.
Copper settlements (ranges include electronic and pit trading):
Jul $3.4870; down 1.50 cents; Range $3.4795-$3.5335
May $3.4875; down 1.65 cents; Range $3.4875-$3.5175