METALS-Copper hits three-week high on China data, Fed comments
reuters.com
Tuesday September 13, 2016 8:22 AM
* Strong Chinese data boosts copper after slide
* LME copper stocks fall 825 tonnes on Monday
* GRAPHIC-2016 metal returns: (Adds official prices)
By Jan Harvey
LONDON, Sept 13 (Reuters) - Copper hit a three-week high onTuesday after Chinese economic data beat forecasts and as adovish tone from a Federal Reserve official curbed speculationthat a U.S. interest rate rise is imminent.
The metal recovered from the previous session's 12-week lowafter data released overnight showed factory output and retailsales in China, the world's biggest consumer of copper, grewfaster than expected last month. Concerns over the broader global economy were also calmedafter Fed Governor Lael Brainard cautioned on Monday againstraising U.S. interest rates too quickly, dampening speculationthat an increase could come as early as next week. Three-month copper on the London Metal Exchange wasup 0.4 percent at $4,664 a tonne in official trading, afterearlier hitting $4,692, the strongest since Aug. 24. In theprevious session it hit its lowest since June 20 at $4,582.
"All the metals-intensive data from China was a lot better,so that clearly shows there is stability coming through,"Societe Generale analyst Robin Bhar said. "Also, copperinventories have not been rising in recent days."
"The Fed speaker Brainard also came out pretty dovish, andthat helped risk-on sentiment," he said. "We're seeing thatreflected across the LME with some risk appetite comingthrough."
LME copper stocks, which have more than doubled since thestart of June, fell 825 tonnes on Monday, only their second dropsince Aug. 19, exchange data showed.
LME zinc was up 0.3 percent in official trading at$2,269, while LME tin was 0.8 percent higher at $19,200a tonne. Aluminium , which hit a three-month low of$1,564 a tonne on Monday, rose 0.4 percent to $1,574 a tonne.
"Aluminium has come under pressure, falling almost 6 percentover the past two weeks, while physical premiums have alsofallen," ING said in a note. "U.S. aluminium premiums fell to aseven-year low, which suggests that despite a market deficit,availability in the physical market remains ample."
Standard Chartered, however, said in a report that China waslikely to step up its exports of semi-processed aluminium toglobal markets this year and carve out a bigger market share,after a revival in prices triggered production restarts.
China's semi-manufactured aluminium exports jumped 17percent on the year to 410,000 tonnes in August. LME nickel and LME lead were untraded inofficial rings, but were last down 0.5 percent at $10,050 atonne, and up 1.4 percent at $1,909 a tonne, respectively.
