Bloomberg News

Copper Declines as Europe Crisis May Damp Demand: LME Preview

January 09, 2012

Jan. 9 (Bloomberg) -- Copper may decline on the London Metal Exchange as investors bet Europe’s debt crisis may damp demand this year after stockpiles in Shanghai gained for a fifth week.

Market News:

-- German Chancellor Angela Merkel and French President Nicolas Sarkozy meet today for the first time in 2012 as they seek to craft a master plan for rescuing the euro over the next three months. NSN LXHV5P1A1I4H <GO>

-- Asian stocks fell for a third day and copper retreated after India’s Prime Minister cut his economic growth forecast and Australian retail sales missed estimates. The euro touched an 11-year low against the yen before European leaders meet to discuss rescue plans for the region. NSN LXIS4P0UQVI9 <GO>

-- The most accurate foreign-exchange forecasters say the euro will depreciate against the dollar for a third straight year, equaling its longest slump since its creation in 1999, as Europe slips into recession. NSN LXISHS6JTSEA <GO>

-- European Central Bank President Mario Draghi may act more like Ben S. Bernanke than Jean-Claude Trichet in 2012. NSN LXI7DA1A74E9 <GO>

-- Banks will be allowed go below minimum liquidity levels set by global regulators during a financial crisis so that they can avoid cash-flow difficulties. NSN LXHVZK6KLVR4 <GO>

-- U.S. corporations ended 2011 with the slowest profit growth in two years as the mending economy that lifted Macy’s Inc. was met by a European slump that vexed companies more tied to global sales, such as Cisco Systems Inc. NSN LXI54V0UQVI9 <GO>

-- Hedge funds raised their wagers on higher commodity prices by the most since July 2010 after signs of accelerating U.S. growth bolstered optimism that demand for raw materials will strengthen. NSN LXILXQ0D9L35 <GO>

Metals News:

-- General Motors Co., the biggest foreign automaker in China, said it expanded sales in the country to a record last year, led by demand for its Buick and Chevrolet sedans. NSN LXIGBM6S9729 <GO>

-- Hedge-fund managers and other large speculators decreased their net-short position in New York copper futures in the week ended Jan. 3, according to U.S. Commodity Futures Trading Commission data. NSN LXE9800J1HDF <GO>

-- Two workers at Freeport-McMoRan Copper & Gold Inc.’s Grasberg mine in Indonesia were fatally injured this morning in a shooting near the site, according to Ramdani Sirait, a spokesman for the company’s local unit. NSN LXIQ196KLVR4 <GO>

-- Alcoa Inc. options traders are the most bullish since October 2010 before the company reports results today, betting smelter capacity cuts and improving economic data will buoy the price of aluminum. NSN LXICC26VDKHT <GO>

-- Zambia’s copper production declined to about 790,000 metric tons in 2011 from 819,000 tons a year earlier because of rain and strikes, the Lusaka-based Daily Mail said, citing central bank documents. NSN LXIMR26JTSEA <GO>

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