India copper futures steady on rupee, demand

MUMBAI, Jan 5 (Reuters) - India's copper futures traded steady on Monday, after gaining more than 10 percent last week, as pressure from sluggish demand was offset by a weaker rupee, analysts said.

A weaker rupee supported the red metal as it made the dollar-denominated asset more expensive, while demand concerns dragged the metal down.

At 3:17 p.m., three-month copper on the London Metal Exchange MCU3=LX was at $3,194 a tonne, after falling to $3,157 earlier in the day, compared with Friday's close of $3,210.50.

"Copper looks bullish on technical grounds, and as LME copper is holding above $3,100 per tonne level," said Somnath Dey, in-charge, metals and energy research at Religare Commodities.

However, investors remained concerned about waning demand for industrial metals amid a deepening global recession and rising inventory levels, analysts said.

Copper stocks in warehouses monitored by the LME were higher by 1,500 tonnes at 342,050 tonnes on Monday.

Investors will be closely watching U.S. auto sales figures for December, due later in the day, and November durable goods and factory orders on Tuesday for direction in the base metals complex.

Meanwhile, China will resume a tax-free policy on imports of concentrate for copper, nickel and cobalt from Feb. 1, a statement on the Ministry of Commerce's website said. (www.mofcom.gov.cn) see [ID:nHKG338921]

The country will also resume the policy on exports of refined copper and nickel, as well as on semi-finished aluminium profiles.