Copper fell for a second day in London on concern demand will take time to revive after an official manufacturing gauge was weaker than projected in China, the world’s biggest consumer of the metal.
A Purchasing Managers’ Index was at 50.6 in April, China’s statistics bureau and logistics federation said today, below the 50.7 median estimate in a Bloomberg News survey of economists. Markets in the country will reopen tomorrow after a three-day break. Copper rose in London trading last week after five weeks of declines, the longest streak since November.
“Chinese end-users were taking advantage of low prices to restock,” Nic Brown, head of commodities research at Natixis SA in London, said by e-mail today. “With China out for three days, the market is losing some of that positive impetus.”
Copper for delivery in three months lost 1.3 percent to $6,964 a metric ton by 9:22 a.m. on the London Metal Exchange after slumping for a third month in April. Copper for delivery in July dropped 1.1 percent to $3.151 a pound on the Comex in New York, where futures trading volumes were 48 percent lower than the average in the past 100 days for the time of day.
“Despite the poor macro data we’ve been seeing in recent weeks, I’d imagine there might also be some replenishment of inventories as demand for copper products begins to improve,” Brown said of China. Imports of refined copper into the country rose in March from a 19-month low, figures showed last week.
Prices also slid today as Antofagasta Plc, the sixth- largest copper miner, said first-quarter production rose 13 percent from a year earlier, signaling supply remains ample. Copper inventories tracked by the LME almost doubled this year.
The Federal Reserve will probably reduce its monthly bond buying in the fourth quarter to $50 billion from $85 billion as unwinding of record stimulus begins, economists surveyed by Bloomberg said before a policy meeting concludes today. The U.S. is the second-biggest copper consumer.
Copper stockpiles monitored by the LME fell 0.1 percent to 618,175 tons, daily exchange figures showed. Orders to withdraw the metal from warehouses declined 1.5 percent to 157,725 tons.
Tin for delivery in three months on the LME dropped as much as 2.6 percent. Nickel, zinc, lead and aluminum declined.
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