US Copper Ends Lower amid Revived Risk Aversion

NEW YORK, Sept 7 (Reuters)--

U.S. copper futures ended down
on Tuesday, as fresh concerns about the health of the European
banking sector fed a wave of risk reduction in the broader
market and helped drag red metal prices away from four-month
highs.

Copper for December delivery HGZ0 shed 2.95 cents, or
0.84 percent, to close at $3.4705 per lb on the COMEX metals
division of the New York Mercantile Exchange.
 
Range from $3.42 to $3.5345, matching Friday's session
peak -- a high dating back to late April.
 
COMEX estimated final copper futures volume at 26,964
lots, compared with Friday's count of 29,978 lots. IZQI
 
Open interest jumped 3,617 lots to 139,919 contracts as
of Sept. 3.
 
Copper down in sympathy with weaker equity markets as
economic jitters persist with renewed worries over health of
European banking sector - analysts.
 
Sustainability of the $3.50 level now comes into question
- analysts.
 
Risk aversion up after Wall Street Journal report
highlighted shortcomings of European bank stress tests in
July.
 
Economic/demand growth jitters tied to data showing a
fall in German manufacturing orders in July.
 
European copper demand to rise by some 3 percent in
second half of the year from first half, driven by improved
end-use consumption, rather than restocking - Elektrokoppar.

London Metal Exchange (LME) copper warehouse stocks fell
another 1,400 tonnes to 395,475 tonnes. Stockpiles are down
from 6-1/2-year highs at 555,075 tonnes in mid-February.

COMEX copper warehouse stocks down 300 short tons at
95,046 short tons as of Sept. 3.

LME copper CMCU3 closed down $76 at $7,640 a tonne.