April 7, 2017 / 10:36 AM / 3 years ago

METALS-Copper falls after U.S. strike on Syria, China steel sell-off

* LME/ShFE arbitrage: tmsnrt.rs/2oQ5nm2 (Updates with official prices)

By Peter Hobson

LONDON, April 7 (Reuters) - Copper fell on Friday after a U.S. missile strike on Syria prompted investors to move out of riskier assets while the biggest sell-off in Chinese steel futures in two months spilled over into industrial metals.

Base metals were on the defensive following falls in the previous session, said Alastair Munro at Marex Spectron.

“If we’re going to see an unwind of risk you’ll see metals come under pressure,” he said.

* LME COPPER: Three-month copper on the London Metal Exchange closed down 0.4 percent at $5,834 a tonne, ending the week barely changed.

* COPPER TECHNICALS: Copper dipped below key technical support at its 100-day moving average of $5,797 earlier in the session.

* COPPER SPREAD: The discount of LME cash copper to the three-month contract CMCU0-3 was at $32 a tonne, close to the biggest in four years, indicating adequate supply of refined metal in the market.

* CHINA METALS: Base metals came under pressure after rebar on the Shanghai Futures Exchange closed down 4.9 percent, its sharpest fall since Feb. 3, on concerns of rising steel supply and tepid demand.

* LME ZINC: Zinc ended 1.3 percent lower at $2,690 a tonne. The metal used for galvanising steel had broken a long-term up-trend line from its January 2016 low, said Alastair Munro at Marex Spectron. He said technical support for the metal was at $2,640-2,650.

* ZINC SPREAD: The discount of LME cash zinc to the three-month contract CMZN0-3 shrank to $23.80 a tonne from $27.75 earlier in the week, but was still around its largest since November 2015.

* LME LEAD: Lead ended 1.9 percent lower at $2,251 a tonne, pressured by falls in sister metal zinc as well as chart-based selling after prices broke below the 100-day moving average at $2,269.

* WIDER MARKETS: Stocks and the dollar recovered after early falls when a U.S. official played down the risks of escalation following an attack by the United States on a Syrian air base.

But U.S. stocks dipped after U.S. non-farm payrolls showed job growth slowed sharply but the unemployment rate fell to a near 10-year low.

* GERMANY ECONOMY: German industrial output surged in February and the trade balance swelled in what the Economy Ministry said was an “extraordinarily” robust start to the year.

* M&A: Deal value in the metals and mining sector in March was up 11 percent on the previous month but 6 percent lower year-on-year, GFMS analysts said. [bit.ly/2p8AQjx ]

* OTHER METALS: LME aluminium closed up 0.5 percent at $1,962 a tonne. Nickel was 0.9 percent higher at $10,180, and tin finished down 0.3 percent at $20,250.

Additional reporting by James Regan and Melanie Burton in Sydney; Editing by Edmund Blair

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