Feb. 14 (Bloomberg) -- Copper declined for a third day after Moody’s Investors Service cut the debt ratings of six European countries, damping the region’s growth and demand outlook.
Three-month copper fell 0.3 percent to $8,401.25 by 11:37 a.m. Shanghai time, after rising as much as 0.4 percent. The contract retreated 3.8 percent in the past two days. May- delivery copper on the Comex declined 0.4 percent to $3.83 a pound.
“The biggest risks to the market are the problems in Europe and Chinese demand,” said Wang Zhouyi, an analyst at Shanghai CIFCO Futures Co. “Although Greece has approved the austerity plans, there are plenty of obstacles ahead and the downgrade by Moody’s is another example of how serious the problem is.”
Moody’s cut the debt ratings of six European countries including Italy, Spain and Portugal and said it may strip France and the U.K. of their top Aaa ratings, citing Europe’s debt crisis. Greek Prime Minister Lucas Papademos yesterday won parliamentary approval for austerity measures to secure an international bailout after rioters protesting the measures battled police and set fire to buildings in downtown Athens.
The metal for delivery in May on the Shanghai Futures Exchange fell 0.9 percent to 60,200 yuan ($9,555) per ton, catching up with the decline in London overnight.
BHP Billiton Ltd., the world’s biggest mining company, and partner Rio Tinto Group approved a $4.5 billion expansion of Chile’s Escondida copper mine, the Melbourne-based company said in a statement today.
On the LME, aluminum was unchanged at $2,210 a ton. Zinc fell 0.9 percent to $2,057 a ton. Lead climbed 0.2 percent to $2,120 a ton, tin advanced 0.4 percent to $25,100 a ton, and nickel dropped 0.2 percent to $20,510 a ton.
OAO GMK Norilsk Nickel, the world’s largest producer of nickel and palladium, sees metals prices rising this quarter as investment demand rebounds. “Our order book was as long as half-a-year when nickel prices peaked in 2007 and as short as one week in the 2008 crisis,” said Anton Berlin, head of marketing. “Now it’s somewhere in the middle.”
--Helen Sun. Editors: Richard Dobson, Jarrett Banks
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