June 17 (Bloomberg) -- Copper climbed, set for its first weekly advance in three, on optimism that China’s demand is improving, tempering concern about Europe’s debt crisis. Zinc and nickel also gained.
Three-month copper on the London Metal Exchange gained for the first day in three, rising as much as 0.7 percent to $9,125 a metric ton. The metal last traded at $9,077.50 by 3:27 p.m. Singapore time. It has risen 1.5 percent this week. Zinc, nickel and tin also rose on better-than-estimated U.S. jobless claims and housing starts.
“The market is pricing the expectation for a pickup in demand in the months ahead,” Yu Haijian, an analyst at Bohai Futures Co., said from Changchun in Jilin.
September-delivery copper in New York declined 0.4 percent to $4.1205 a pound, while August-delivery metal on the Shanghai Futures Exchange added as much as 0.6 percent to 68,540 yuan ($10,591) a ton.
Copper stockpiles in China, the biggest consumer, dropped by 36 percent last month and 21 percent in April. Inventories in bonded warehouses, used to store shipments before duties are paid, may have fallen 50 percent over the past two months, Chinese traders and analysts estimated this week, prompting speculation of a pickup in imports after two months of decline.
In the U.S., first-time filings for unemployment benefits declined last week to 414,000, compared with 420,000 claims estimated by economists surveyed by Bloomberg News. Construction began on 560,000 houses at an annual pace, exceeding the 545,000 median forecast of economists.
“The global economic environment remains fraught with uncertainty, which will keep a lid on prices,” said Yu.
European leaders meet to discuss the Greek debt crisis today amid concern a default would risk spreading contagion to other countries in the region, sending the euro lower against the yen and dollar. Alan Greenspan, former Federal Reserve chairman, said a default by Greece is “almost certain” and could help drive the U.S. economy into recession.
In China, the central bank announced a half percentage point boost in the reserve requirement ratio for banks on June 14, adding to its 11 reserve-requirement and four interest-rate increases since early 2010 to cool inflation, which climbed to 5.5 percent in May, the fastest pace in almost three years.
Zinc advanced 0.4 percent to $2,214 a ton, nickel climbed 0.3 percent to $21,670 a ton and tin gained 1.2 percent to $25,200 a ton. Aluminum fell 0.4 percent to $2,545.75 a ton while lead fell 0.2 percent to $2,476 a ton.
--Editors: Ovais Subhani, Richard Dobson
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