September 15, 2016 / 1:13 AM / 4 years ago

METALS-London copper drifts with China market on holiday

* Global nickel market deficit eases to 5,200 tonnes in July -INSG

* ShFE closed for mid-autumn holiday, to reopen Monday

* Coming up: U.S. industrial output Aug at 1315 GMT (Adds detail, updates prices)

By Melanie Burton

MELBOURNE, Sept 15 (Reuters) - London copper was treading water on Thursday, a day after posting its biggest daily rise in three months as traders closed short positions following encouraging Chinese economic data and ahead of a spate of holidays.

China’s bank lending more than doubled in August from the previous month, a report showed on Wednesday, adding to brighter economic readings readings from the country earlier this week.

Gauges showed China’s factories and retail sectors grew faster than expected in August as a strong housing market and a government infrastructure spending spree underpinned growth in the world’s second-largest economy and top metals consumer.

“Copper was the big mover of the day as the strong economic data in China spurred speculation that demand will strengthen,” ANZ said in a report.

Three-month copper on the London Metal Exchange had edged down 0.1 percent to $4,767.50 a tonne by 0755 GMT, having jumped 2.6 percent on Wednesday when it also touched its loftiest since Aug. 22 at $4,781.

Copper has now cut through chart resistance at its 100- and 200-day moving averages, strengthening its technical picture.

China’s financial markets are closed from Thursday through Sunday for the Mid-Autumn Festival.

In other metals, LME nickel prices were flat, having fallen nearly 5 percent early in the week.

The global market deficit in nickel narrowed to 5,200 tonnes in July from a revised deficit of 12,100 tonnes the month before, taking the shortfall so far this year to 42,500 tonnes, data from the International Nickel Study Group showed.

Worries about Philippines nickel ore supply curtailing feed to China’s vast stainless steel industry have been the key drivers of nickel’s 24-percent rally over June and July.

Those worries have dissipated after a crackdown on mines that failed to pass environmental regulations appeared not to spread as widely as had been feared. A conclusion to the country’s mining audit is now expected on Sept. 22.

The INSG report showed robust Philippines nickel mined ore supply in July at 47,000 tonnes and on par with 52,000 in June and 45,000 in May.

Meanwhile, Japanese manufacturers’ confidence bounced from a three-year low, while sentiment in the services sector hit its lowest since 2013 when the central bank began bold monetary stimulus, a Reuters poll showed, underscoring a fragile economic recovery.

Elsewhere, a Chinese industry group has denied that the country’s aluminium producers could be involved in exporting extrusion products via Mexico to circumvent U.S. duties, in the latest sign of bubbling trade tensions between the two nations.


Three month LME copper

Most active ShFE copper

Three month LME aluminium

Most active ShFE aluminium

Three month LME zinc

Most active ShFE zinc

Three month LME lead

Most active ShFE lead

Three month LME nickel

Most active ShFE nickel

Three month LME tin

Most active ShFE tin

Reporting by Melanie Burton; Editing by Richard Pullin and Joseph Radford

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