Nov. 29 (Bloomberg) -- Copper declined from a one-week high as Moody’s Investors Service said it was considering a downgrade of debt ratings for European banks, increasing concern that the region’s policymakers may struggle to contain the crisis.
The contract for three-month delivery dropped as much as 1.3 percent to $7,395 a metric ton on the London Metal Exchange, and traded at $7,467 at 2:25 p.m. Shanghai time. The metal rallied as much as 4.2 percent yesterday. Copper for February- delivery on the Shanghai Futures Exchange was little changed at 55,420 yuan ($8,688) a ton.
Moody’s said it may lower debt ratings for banks in 15 European nations. All subordinated, junior-subordinated and Tier 3 debt ratings of 87 banks in countries where the subordinated debt incorporates an assumption of government support were placed on review for downgrade, the company said in a statement.
“Europe’s debt crisis is still the biggest concern,” said Xie Xiaoming, an analyst at Shengda Futures Co. in Guangzhou. “The focus is how effective the leaders’ measures will be in solving the problem.”
Euro-area finance ministers will meet in Brussels today to work out details on how the European Financial Stability Facility will boost its muscle by insuring sovereign debt with guarantees. Moody’s said the “rapid escalation” of Europe’s debt and banking crisis is threatening all of the region’s sovereign ratings.
In Peru, Freeport-McMoRan Copper & Gold Inc.’s workers voted to end a 61-day strike, and return to the mine Nov. 30 after the government pledged to settle a wage dispute, union official William Camacho said yesterday. In Chile, Anglo American Plc and Xstrata Plc’s Collahuasi unit fired some workers as a third strike this year slowed operations at the northern Chilean copper mine.
On the LME, zinc dropped 0.8 percent to $1,942 a ton and tin lost 1.2 percent to $20,600 a ton. Aluminum gained 0.2 percent to $2,030.25 a ton, and nickel rose 0.9 percent to $17,335 a ton. Lead was unchanged at $2,025 per ton.
--Helen Sun. Editors: Jarrett Banks, James Poole
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