SHANGHAI, Mar. 13 (SMM) – In Europe, the UK announced softer-than-anticipated manufacturing and industrial output data on Tuesday, while Germany's central bank warned that the government crisis in the euro zone is not over. This caused European stock markets to close flat. The US House of Representatives advocated the Ryan budget plan that can help the US shake off deficit in ten years, while the Democratic Party proposed to increase USD 9750 billion of tax in ten years. In this context, the Dow Jones Industrial Average closed 0.02% up as US equity markets swung between gains and losses. The US dollar index, though, settled lower, helping gold close with a gain of 0.9% and crude oil rebound by 0.5%. This ignited short-covering but enticed investors to buy. As a consequence, LME copper prices surged quickly to USD 7,883/mt before ending at USD 7,829/mt, an increase of USD 62/mt and recouping the 5 and 10-day moving average.
As market sentiment improves, LME copper has confirmed support at the 10-day moving average. However, Asian investor may make profit-taking, so LME copper prices lack further rising momentum, with prices expected to move between USD 7,770-7,870/mt during Wednesday's Asian trading hours. SHFE copper prices are likely to rise by RMB 600-700/mt after opening up, but should suffer pressure at RMB 57,000/mt. SHFE 1306 copper contract will hover in the RMB 56,800-57,500/mt band. Shanghai spot copper premiums are estimated between RMB 0-110/mt versus SHFE 1303 copper contract.