August 15, 2019 / 5:03 AM / 9 days ago

METALS-Copper hovers near 2-yr low amid recession fears

(Updates prices)

By Tom Daly and Mai Nguyen

BEIJING/SINGAPORE, Aug 15 (Reuters) - Shanghai copper fell on Thursday, while London copper edged up but struggled to break away from its two-year lows, weighed down by growing fears of a global recession and weak industrial output growth in China.

Yields on 10-year U.S. Treasury notes fell below the two-year yield, intra-day, for the first time since 2007 on Wednesday, in what is known as a yield curve inversion and widely seen by investors as a sign that a recession is coming.

China’s economy stumbled more sharply than expected in July, with industrial output growth cooling to a more than 17-year low, as the intensifying U.S. trade war took a heavier toll on businesses and consumers.

“Risk appetite suffered a hit after growth in industrial output in China fell well below expectations,” ANZ said in a note.

FUNDAMENTALS

* COPPER: Three-month copper on the London Metal Exchange edged up 0.2% to $5,773 a tonne as of 0702 GMT, nearing a two-year low of $5,640 reached earlier this month and after closing down 1.1% on Wednesday.

* SHANGHAI COPPER: The most-traded October copper contract on the Shanghai Futures Exchange declined 0.7% to 46,440 yuan ($6,615.76) a tonne.

* CODELCO: The incoming CEO of Chile’s state copper miner Codelco is “optimistic” about the red metal’s long-term market price despite the global volatility caused by the U.S.-China trade war.

* VEDANTA: Zambia’s government said on Wednesday that an ongoing liquidation process of Vedanta Resources’ Konkola Copper Mines will not be affected by a recent meeting with Vedanta’s chairman on the disputed liquidation.

* ALUMINIUM: LME aluminium rose 0.1%, while Shanghai aluminium increased 0.3% amid ongoing concerns of disruptions after floods in the smelting heartland of China’s eastern province of Shandong.

* OTHER PRICES: LME nickel fell 0.9% after hitting a 16-month high last week over concerns on supply disruption from Indonesia, while ShFE nickel edged up 0.3%. LME zinc rose 1.2%, but ShFE zinc dropped 0.7%.

* NICKEL SPREAD: The difference between LME nickel cash and three-month contract CMNI0-3 flipped to a premium of $13 a tonne, after staying in the discount zone since late May, indicating a shortage of nearby supplies.

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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 = 7.0196 Chinese yuan renminbi) (Reporting by Tom Daly in Beijing and Mai Nguyen in Singapore; editing by Richard Pullin, Bernard Orr)

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