Copper Caps Third Weekly Decline in Shanghai on Inventories

SINGAPORE, Sept. 18 -- Copper dropped for the first time in four days in Shanghai, capping a third weekly decline, as expanding global stockpiles of the metal raised concern that prices don't reflect demand.

    Inventories monitored by the London Metal Exchange grew for a 15th day to 324,375 metric tons yesterday, the most since May 26. Copper stockpiles in Shanghai climbed for a seventh week last week to a two-year high of 97,396 tons. The exchange will report this week's data after the market closes today.

    "The bears are using stockpiles as a good excuse to push the market lower," Li Junchao, an analyst at Western Mining Co.'s futures department, said from Shanghai today.

    The December-delivery contract on the Shanghai Futures Exchange fell as much as 2 percent to 48,680 yuan ($7,129) a ton and ended the day at 48,690 yuan, down 1 percent this week.

    Three-month delivery copper on the London Metal Exchange lost as much as 1.6 percent to $6,280 a ton before trading at $6,303 at 3:18 p.m. in Singapore. December-delivery copper in New York slid 0.9 percent to $2.8715 a pound.

    A decline in global equities also weighed on copper, said Li. The MSCI Asia Pacific Index tumbled from a one-year high as Aiful Corp., Japan's third-largest consumer lender by revenue, sought to reschedule debt payments. Stocks in the U.S. fell yesterday on concern the market's recent rally outpaced prospects for earnings growth as FedEx Corp. and Oracle Corp. reported sales that missed analysts' estimates.

    Among other LME-traded metals, aluminum lost 1 percent to $1,947 a ton, zinc fell 2 percent to $1,920 a ton and lead declined 4.4 percent to $2,176 a ton. Nickel dropped 1.9 percent to $17,240 a ton, and tin declined 2 percent to $14,500 a ton as of 3:20 p.m. in Singapore.

    (Source: Bloomberg)