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Shanghai copper slips for 2nd day on lukewarm trade

Shanghai copper slips for 2nd day on lukewarm tradeBEIJING: Shanghai copper extended losses into a second session on Wednesday, curbed by tepid spot trading amid increasing stockpiles at the futures exchange.

Stocks of cash-settled copper futures warrants in China increased for a fourth straight session on Tuesday, adding 2,887 tonnes to 58,230 tonnes, according data from the Shanghai Futures Exchange (ShFE).

Open interest of the most active Shanghai copper futures, the number of outstanding contracts held by traders and a gauge of liquidity, fell to 165,308 lots on Wednesday, the lowest since Sept.4. One lot equals 5 tonnes.

“Demand from downstream users remains weak,” analysts from Huatai Futures said in a note, adding that an increase in  refined copper imports and expansion of smelter capacity in China would also weigh on copper prices.

FUNDAMENTALS

* Three-month copper on the London Metal Exchange slid 0.6 percent to $6,194 a tonne by 0742 GMT, and the copper contract for November delivery on the ShFE closed 0.4 percent lower at 50,290 yuan ($7,264.72) a tonne.

* TRADE: Chinese exporters are mostly confident they can weather a trade war with the United States, but worry about collateral damage it might cause throughout the global economy, according to a Reuters poll of participants at China’s largest trade fair.

* CHINA DEBT: Off-balance-sheet borrowings by Chinese local governments could be as high as 40 trillion yuan ($5.78 trillion) and amount to “a debt iceberg with titanic credit risks”, S&P Global Ratings said in a report on Tuesday.

* BHP: The world’s biggest miner, BHP, said on Wednesday its first-quarter iron ore production rose 8 percent on strong Chinese demand for high-grade ore, but cut its fiscal 2019 guidance for copper production, citing outages at key mines.

* COPPER PROJECT: Chile’s state copper miner, Codelco, has submitted an environmental impact assessment of its plans to overhaul its aging Salvador deposit that would sharply increase its production and extend its life by 40 years.

* COPPER TAX: Zambia’s proposed mining tax increases will hit mineral exploration and production in Africa’s second biggest copper producer, said companies involved in exploration.

* For the top stories in metals and other news, click  or

MARKETS NEWS:

* Asian equities got some much needed relief on Wednesday after upbeat U.S. earnings reports drove a rebound on Wall Street and helped restore a little confidence in emerging market stocks and currencies.

DATA/EVENTS

0830  UK Consumer prices Sep

0900  Euro Zone Construction output Aug

1230  U.S. Housing starts Sep

1230  U.S. Building permits Sep

1800  U.S. Federal Reserve releases minutes from its Sept. 25-26 policy meeting

PRICES

Three month LME copper

Most active ShFE copper

Three month LME aluminium

Most active ShFE aluminium

Three month LME zinc

Most active ShFE zinc

Three month LME lead

Most active ShFE lead

Three month LME nickel

Most active ShFE nickel

Three month LME tin

Most active ShFE tin

ARBS

($1 = 6.9225 Chinese yuan renminbi)

Copyright Reuters, 2018


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