US Copper Ends off Highs after Disappointing ISM Data

NEW YORK, Sept 3 (Reuters) –

U.S. copper hit four-month
highs for a third straight day on Friday, supported by strong
U.S. employment data, but pared gains to end with only a small
rise as Wall Street stocks came off highs when data showed the
U.S. non-manufacturing sector grew at a slower pace in August.
 
Copper for December delivery HGZ0 finished up 0.45
cents, or 0.13 percent, at $3.50 per lb on the COMEX metals
division of the New York Mercantile Exchange.
 
December copper soared to its session high at $3.5345 per
lb, the highest in four months.
 
It rose to a multi-month peak after improved U.S.
non-farm payrolls data, but later fell to a session low at
$3.4710 per lb.
 
COMEX estimated final copper futures volume at 18,834
lots, versus Wednesday's estimated volume of 27,564 lots.
IZQI
 
Open interest rose by 982 lots to 133,302 contracts as of
Sept. 2.
 
U.S. non-farm payrolls fell for a third straight month in
August, but by much less than analysts expected, easing
pressure on the Federal Reserve to prop up economic growth, and
boosting stock market and copper prices.

Non-farm payrolls declined by 54,000, almost half of the
100,000 job losses analysts had expected, an encouraging sign
that the economy may not be headed for a double-dip recession.
 
The rally was short lived, however, as the Institute for
Supply Management's index measuring U.S. non-manufacturing
sector grew in August, but at a slower rate than expected,
pulling copper prices off highs.

"The Dow Jones industrial average was very strong today
at the heels of robust employment data. This created a feeling
that perhaps we're starting to see the beginning of some
sustained economic recovery," said Scott Meyers, senior trading
analyst at Pioneer Futures in New York.
 
"Copper prices were moving directly with the stock market
today. So, they rose with stock prices. My question is how much
of this is window dressing before the end of the third
quarter?," he added.
 
The stock market's rally following the employment data
was also tempered by the ISM report.

London Metal Exchange (LME) copper warehouse stocks
extended falls, slipping 1,800 tonnes to 397,675 tonnes.

Benchmark copper CMCU3 for three-months delivery on the
London Metal Exchange ended at $7,640 a tonne compared with a
close of $7,635 a tonne on Thursday. It touched $7,750 earlier,
its highest since late April.