METALS-Copper rises after Bernanke calls end to recession

Wed Sep 16, 2009 8:50am IST

 * Metals up after Bernanke says recession likely over
 * Soft dlr adds to feel-good factor; too soon to celebrate
 * Copper up 1 pct, lead 2 pct, but off recent peak
 By Nick Trevethan
 SINGAPORE, Sept 16 (Reuters) - Copper prices in London and
Shanghai rose 1 percent on Wednesday after Federal Reserve
Chairman Ben Bernanke said the U.S. recession was probably
over, a sentiment reinforced by strong retail and manufacturing
data.
 But a year after the Lehman Brothers collapse, Bernanke
said the recovery would be slow and it would take time to
create jobs.
 "Even though from a technical perspective the recession is
very likely over at this point, it's still going to feel like a
very weak economy for some time," Bernanke said after
addressing a Brookings Institution conference.
 U.S. retail sales grow at their fastest pace in 3-½   years
in August, New York State manufacturing activity hit a near
two-year high in September, all of which kept the dollar under
pressure, trading near $1.47, its lowest this year versus the
euro EUR=. [ID:nN1576055] [ID:nN15548319]
 "Is it time to start popping champagne corks? Probably not
quite yet," a dealer in Singapore said.
 "Bernanke was still pretty cautious and Americans are still
worried about their jobs, their homes and paying their bills so
a consumer-led boom is still far in the future."
 Nevertheless three-month copper on the London Metal
Exchange MCU3 rose $65 to $6,275 a tonne by 0251 GMT, up 1.8
percent from where it had stood when Shanghai closed on Tuesday
and around its highest since Friday.
 "The copper price has traded mostly in the $6,000 to $6,400
range," said David Moore, commodities strategist at
Commonwealth Bank of Australia in a report.
 "Recent increases in exchange copper stocks and a
moderation in China's refined copper imports have limited the
upside to the copper price. And in our view, leave some
downside risk over the balance of 2009."
 On the stocks front, LME copper inventories rose 2,750
tonnes on Tuesday to 322,550 tonnes, up by nearly a quarter
since July. Early expectations were for weekly Shanghai copper
stocks to be flat to slightly lower when data is released on
Friday. <0#SGH-STOCKS>
 Last week stocks hit their highest in two years.
  "Chinese consumers are buying Shanghai metal rather than
importing, one reason why we might see a decline in stocks," a
Shanghai-based trader said.
 The new third month contract in Shanghai, December SCFc3
rose 1 percent to 48,860 yuan a tonne while the most-active
fourth month SCFc4 gained similarly at 48,750 yuan.
 "There is some interest from domestic consumers but it's
pretty slow," a trader in Shanghai said.
 "But there is still a lot of speculative activity, though
its its all day trading and those short-term guys are just
playing off the moves in London."
 Other metals also rose with lead MPB3 heading the pack,
up 1.9 percent at $2,208, though quite a way off last week's
16-month high of $2,511. On Thursday lead prices slumped 12
percent, their biggest one-day decline on record.
 Base metals prices at 0251 GMT
 Metal         Last       Change   Pct Move  End 2008  Pct chg
09
 LME Cu        6275.00     65.00     +1.05    3060.00   
105.07
 SHFE Cu*     48860.00    480.00     +0.99   23840.00   
104.95
 LME Alum      1861.00      6.00     +0.32    1535.00    
21.24
 SHFE Alum*   14920.00     60.00     +0.40   11540.00    
29.29
 COMEX Cu**     284.95      2.10     +0.74     139.50   
104.27
 LME Zinc      1868.00      7.00     +0.38    1208.00    
54.64
 SHFE Zinc    15195.00     45.00     +0.30   10120.00    
50.15
 LME Nickel   17000.00    250.00     +1.49   11700.00    
45.30
 LME Lead      2208.00     41.50     +1.92     999.00   
121.02
 LME Tin      14380.00    155.00     +1.09   10700.00    
34.39
 LME/Shanghai arb^          1266
 Dollar/yuan          6.8275 \ 6.8299
 ** 1st contract month for COMEX copper
  * 3rd contact month for SHFE aluminium, copper and zinc
  ^ LME 3-m copper in yuan, including 17 pct VAT, minus SHFE
third month
 (Editing by Kazunori Takada)

















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