September 25, 2012 / 11:19 AM / 8 years ago

CORRECTED-METALS-Copper gains on U.S. data, China demand uncertain

(Corrects September rise in copper to more than 8 percent from 18 percent)
    * Trade thin ahead of Chinese National Day holidays
    * Copper, aluminium physical demand still poor
    * U.S. consumer confidence at seven-month high

    By Silvia Antonioli and Harpreet Bhal
    LONDON, Sept 25 (Reuters) - Copper rose on Tuesday as the euro gained
against the dollar after data showed U.S. consumer confidence jumped to its
highest in seven months in September, but gains were capped by concerns about
the outlook for demand from top copper consumer China. 
    Benchmark copper on the London Metal Exchange (LME) rose to $8,244 a
tonne at 1448 GMT, up 0.8 percent from a close of $8,183 on Monday.
    U.S. consumer confidence jumped to its highest level in seven months in
September as Americans were more optimistic about the jobs market and income
prospects, a private sector report showed on Tuesday. 
    The data helped the euro extend gains against the dollar, which fell against
a basket of currencies. A weak dollar makes commodities priced in the U.S. unit
cheaper for holders of other currencies. 
    "The latest economic data indicates that the current weakness isn't as bad
as some had feared but the data is still relatively soft generally," said Ross
Strachan, economist at Capital Economics. 
    "You have got a bit of a hiatus in the weeks until the elections in the
U.S.," he said, adding that investors will be watching politicians' next moves
to shore up the economy following the presidential election in November.
    The metal is on track to rise more than 8 percent in September, following a
rally in the first half of the month on the back of monetary easing measures
announced by central banks in the United States, Europe and Japan. 
    
  
     
    CHINA EYED 
    Also supporting prices, was Monday's news that China's Yunnan province will
stockpile 300,000 tonnes of industrial metals, including aluminium, copper and
zinc, from local producers under a plan that will also help smelters secure more
bank loans. 
    But concerns remained about the outlook for physical demand from China,
given sluggish consumption since the beginning of the year in the country that
consumes as much as 40 percent of global refined copper.
    Copper trading volumes have fallen in the last couple of days as, given the
uncertain economic picture, players prefer not to hold positions with the
Chinese National Day holiday week approaching, analysts said.
    In Europe, copper product demand for physical delivery has remained slack so
far in September following the end of the traditional summer holiday period,
Aurubis, Europe's biggest copper smelter, said on Tuesday.
    "I don't think the physical demand is there at all right now so you are
really trading off the macro data and announcements," said Credit Suisse metals
analyst Ivan Szpakowski.
    Across the wider economy, the euro zone remains a cause for worry for
investors as German business sentiment dropped for a fifth straight month in
September, raising fears of recession. 
    Concerns also surround Spain's finances as Madrid holds back from applying
for a bailout for fear of a political backlash at home. This has doused the
expectations of some investors that the highly indebted euro zone member would
ask for bailout at an EU summit on Oct. 18-19. 
    In other metals, tin rose to $21,150 a tonne from $20,650 while zinc
, used to galvanize steel, was at $2,124.75 a tonne from $2,103 at
Monday's close.
    Battery material lead rose to $2,298.75 a tonne from $2,267 and
aluminium at $2,097.25 from $2,080.
    Stainless steel material nickel rose to $18,360 a tonne from
$17,975.
    Global stainless steel production slipped 0.2 percent in the first half of
the year, a report from industry body ISSF showed, as the sector battles poor
demand and falling prices. 
    
 Metal Prices at 1448 GMT
 Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T
  Metal            Last      Change  Pct Move   End 2011   Ytd Pct
                                                              move
  COMEX Cu       376.05        2.35     +0.63     344.75      9.08
  LME Alum      2096.50       16.50     +0.79    2020.00      3.79
  LME Cu        8242.25       59.25     +0.72    7600.00      8.45
  LME Lead      2299.00       32.00     +1.41    2034.00     13.03
  LME Nickel   18361.00      386.00     +2.15   18650.00     -1.55
  LME Tin      21050.00      400.00     +1.94   19200.00      9.64
  LME Zinc      2125.50       22.50     +1.07    1845.00     15.20
  SHFE Alu     15640.00      -25.00     -0.16   15845.00     -1.29
  SHFE Cu*     59140.00       40.00     +0.07   55360.00      6.83
  SHFE Zin     15505.00       30.00     +0.19   14795.00      4.80
 ** Benchmark month for COMEX copper
 * 3rd contract month for SHFE AL, CU and ZN
 SHFE ZN began trading on 26/3/07
 
 (Additional reporting by Carrie Ho in Shanghai; Editing by Catherine Evans and
Anthony Barker)
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