Jul 10, 2012 (Dow Jones) NEW YORK--Copper futures extended their losses Tuesday as a weaker euro added to trader pessimism sparked by weak monthly copper imports data from China.
The most actively traded contract, for September delivery, settled down 3.35 cents, or 1%, at $3.398 a pound on the Comex division of the New York Mercantile Exchange.
Copper prices marched lower in step with the euro after Italy's Prime Minister Mario Monti reiterated Italy won't need a bailout, but suggested that Europe's stability fund could help keep Rome's borrowing costs in check.
The euro slid near a two-year low of $1.2235, putting pressure on dollar-denominated copper futures which become more expensive for investors in Europe as the euro weakens.
Earlier in the day, China put a damper on trader outlook after it reported that its copper imports fell 17.5% in June to 346,223 metric tons from May. China's imports of copper scrap also declined last month, tumbling 12% to 370,000 tons.
"Overnight business was thin and the already poor sentiment was given another knock by weaker than expected Chinese import data for industrial metals," brokers at Sucden Financial said in a note to clients.
China is the world's largest consumer of copper and slower imports of the industrial metal, alongside the recent string of weaker economic data from the world's second largest economy, have been a worry for market participants. China consumes about 40% of annual world copper output, so slower demand there could see prices weaken as metal supply becomes more plentiful.
However, analysts at both Commerzbank and Barclays attributed China's slower copper imports to unfavorable price gaps between Shanghai and London copper prices. Copper traders and manufacturers in China have little incentive to import copper from outside the country at a higher price when domestically traded and stored copper is available at a lower price.
Copper settlements (ranges include electronic and pit trading):
Jul $3.3930; down 3.30 cents; Range $3.3805-$3.4300
Sep $3.3980; down 3.35 cents; Range $3.3820-$3.4400