August 11, 2017 / 1:51 AM / in 3 months

METALS-Shanghai metals fall on U.S.-N Korea tensions

SYDNEY, Aug 11 (Reuters) - Most Chinese base metals were trading lower on Friday, pressured by uncertainty over U.S.-North Korea tensions that was shifting investment into gold and low-risk instruments.

“Rising geopolitical tension was once again the dominant theme in commodity markets,” ANZ Bank said in a report.

North Korea said it was completing plans to fire four intermediate-range missiles over Japan to land near the U.S. Pacific island territory of Guam.

FUNDAMENTALS

* LONDON COPPER: Three-month copper on the London Metal Exchange slipped 0.5 percent to $6,390 a tonne by 0100 GMT, extending losses from the previous session.

* SHANGHAI COPPER: The most-traded copper contract on the Shanghai Futures Exchange dropped nearly 1.5 percent to 50,290 yuan ($7,566.96) a tonne shortly after the open.

* LEAD DROPS: ShFE lead was also a big loser, falling more than 1.6 percent. LME lead was flat, but remained close to six-month highs hit earlier in the week on shortfalls in pre-refined lead concentrate supply.

* TRUMP: U.S. President Donald Trump ratcheted up his rhetoric against North Korea and its leader on Thursday, warning Pyongyang against attacking Guam or U.S. allies after it disclosed plans to fire missiles over Japan to land near the U.S. Pacific territory. * GOLD UP: Gold prices edged up to touch their highest in over two months on Friday, set for a fourth consecutive day of gains.

* LOW RISK: Stock funds in the United States posted $2.8 billion in withdrawals during the seven days through Aug. 9, marking the largest outflows in five weeks. Nearly $31 billion moved into relatively low-risk money market funds, the strongest figure since 2013. About $4 billion moved into taxable and municipal bonds, according to the research service.

* ELECTRIC CARS: Mining group Glencore raised earnings guidance for its trading business, citing higher commodity prices, and said on Thursday increased take-up of electric vehicles and demand for energy storage would boost demand for its products.

* ALUMINIUM SUPPLIES: Worries about supplies from top producer China have been reinforced by Shandong province, which this week ordered the closure of 3.21 million tonnes of aluminium capacity.

* ENVIRONMENT: The shutdowns come as China’s Ministry of Environmental Protection (MEP) said it was embarking on its fourth round of environmental inspections across eight provinces and regions, including Shandong.

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MARKETS NEWS

* Australian stock futures slumped early on Friday and other Asian markets looked set to follow as tensions ramped up between the U.S. and North Korea, sending investors into less risky assets such as gold, the yen and U.S. government bonds.

DATA AHEAD (GMT) 0600 Germany Consumer prices final Jul 1230 U.S. Consumer prices Jul 1500 U.S. Cleveland Fed CPI Jul

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 = 6.6460 Chinese yuan renminbi)

Reporting by James Regan; Editing by Richard Pullin

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