September 6, 2017 / 5:01 AM / in 2 years

METALS-London copper eases from 3-yr peak as investors book profits

 (Updates prices)
    By Melanie Burton
    MELBOURNE, Sept 6 (Reuters) - London copper dipped on
Wednesday after retreating from three-year highs in the previous
session, as investors booked profits amid ongoing tensions over
North Korea. 
    "Yesterday's correction was realistically overdue by a long
way with markets like nickel that have rallied almost 30 percent
without any major interruptions," said broker Kingdom Futures in
a report.
    "However ... nothing has changed in the metals world in the
last 24 hours, warehouse stocks are still at very low levels ...
the global economy is growing across the board and metal
consumption will rise as a consequence." 
    
    FUNDAMENTALS
    * LONDON COPPER: London Metal Exchange copper eased
0.3 percent to $6,882 a tonne by 0709 GMT. It finished a tad
weaker on Tuesday after earlier climbing to a three-year peak of
$6,970 a tonne. 
    * SHANGHAI COPPER: Shanghai Futures Exchange copper
finished down 0.4 percent at 53,160 yuan ($8,122) a tonne,
having climbed off earlier lows.
    * GOLDMAN OUTLOOK: Goldman Sachs said in a report that
"momentum and technicals are pointing to further upside risks in
copper prices". Chart analysis suggests a target at $7,350 a
tonne compared to a fair value of $6,200, it said. 
    "While we expect copper prices to come down over the next
6-12 months to be in line with fundamentals, they are likely to
remain volatile in the near-term," Goldman added.
    * NORTH KOREA TENSIONS: A top North Korean diplomat on
Tuesday warned that his country is ready to send "more gift
packages" to the United States as world powers struggled for a
response to Pyongyang's latest nuclear weapons test.

    * U.S. RATES: The Federal Reserve is getting more dovish in
the face of weak inflation data, reducing the likelihood of a
third rate hike this year, which traders already see as very
unlikely.
    * CHINA STEEL: Steel prices were softer in Shanghai,
spilling across to input materials nickel and zinc. Shanghai
nickel fell 1.6 percent, while ShFE zinc
dropped 3.6 percent and lead fell 2.5 percent.
    * CHINA LEAD MARKET: The China mainland market for lead is
tightening, which can be seen in a rising front-month ShFE lead
contract against the three-month contract, while the arbitrage
turned positive for imports around mid-August. China has been
shutting lead smelters as part of environmental inspections. 
    
    PRICES    
  
 BASE METALS PRICES                    0709 GMT          
 Three month LME copper                              6885
 Most active ShFE copper                            53160
 Three month LME aluminium                           2076
 Most active ShFE aluminium                         16380
 Three month LME zinc                                3089
 Most active ShFE zinc                              25185
 Three month LME lead                                2323
 Most active ShFE lead                              19010
 Three month LME nickel                             11950
 Most active ShFE nickel                            94880
 Three month LME tin                                20590
 Most active ShFE tin                              145400
                                                         
 BASE METALS ARBITRAGE                                   
 LME/SHFE COPPER                LMESHFCUc3         648.96
 LME/SHFE ALUMINIUM             LMESHFALc3         566.37
 LME/SHFE ZINC                  LMESHFZNc3         987.28
 LME/SHFE LEAD                  LMESHFPBc3         230.04
 LME/SHFE NICKEL                LMESHFNIc3        2284.31
 ($1 = 6.5448 Chinese yuan)

    
 (Reporting by Melanie Burton; Editing by Richard Pullin and
Sunil Nair)
  
 
 
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