November 1, 2018 / 5:02 AM / 21 days ago

METALS-Shanghai aluminium extends falls to fresh 2-year low

 (Adds broker comment, updates prices)
    BEIJING, Nov 1 (Reuters) - Most Shanghai base metals fell on
Thursday, with aluminium hitting a fresh two-year low, on
concerns that an escalating Sino-U.S. trade row will hurt
demand, while another batch of weak data from top metals
consumer China added to the negative tone.
    China's manufacturing sector barely grew last month after
stalling in September, a private survey showed, a day after the
country's official Purchasing Managers' Index showed the slowest
growth in over two years.
    Sentiment on base metals "wasn't helped by data showing
cancelled warrants and orders to withdraw metal from (London
Metal Exchange) warehouses had fallen," ANZ wrote in a note.
    
    FUNDAMENTALS
    * ALUMINIUM: SHFE aluminium fell for a sixth
straight session, shedding as much as 1.2 percent to 13,860 yuan
($1,989.84) a tonne, the lowest since Oct. 24, 2016, before
closing down 1.1 percent at 13,870 yuan.
    * SMELTERS: China's aluminium smelters are under pressure
from current low prices, with the situation exacerbated by high
costs for key raw material alumina, analysts say.  
    * LME ALUMINIUM: London aluminium nudged up 0.2
percent to $1,965.50 a tonne, as of 0702 GMT, after hitting a
near 15-month low of $1,953 in the previous session.
    * COPPER: Three-month LME copper CMCU3> edged up 0.3 percent
to $6,0010 a tonne, while Shanghai copper closed down
0.9 percent at 48,730 yuan a tonne. 
    * SPREADS: "What was interesting was despite falling prices
spreads and particularly in copper kept tightening throughout
the day," Malcolm Freeman, director of Kingdom Futures, said in
note. The premium of LME cash copper over the three-month
contract CMCU0-3 was last at $44.50 a tonne, just below the
near three-year high of $47 hit last week on falling stocks.
    * OTHER METALS: Nickel, which is used to make stainless
steel, slipped as much as 2.3 percent in Shanghai to a
six-month low of 96,010 yuan a tonne before closing down 1.6
percent. Lead bucked the negative trend with a 2.3
percent jump on concerns of an environmental crackdown in China.
   
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    MARKETS NEWS    
    * Battered equity investors got Asia off to a positive start
for November, as Thursday's session benefited from another
strong performance on Wall Street, while the pound jumped on a
report Britain has secured a deal that would give its financial
services firms continued access to European markets after
Brexit.    
        
    PRICES 
 BASE METALS PRICES                       0710 GMT
 Three month LME copper                       6013
 Most active ShFE copper                     48700
 Three month LME aluminium                  1956.5
 Most active ShFE aluminium                  13865
 Three month LME zinc                       2516.5
 Most active ShFE zinc                       21520
 Three month LME lead                         1938
 Most active ShFE lead                       18735
 Three month LME nickel                      11595
 Most active ShFE nickel                     96720
 Three month LME tin                         19050
 Most active ShFE tin                       145850
                                                  
 BASE METALS ARBITRAGE                            
 LME/SHFE COPPER             LMESHFCUc3      154.4
 LME/SHFE ALUMINIUM          LMESHFALc3   -1874.05
 LME/SHFE ZINC               LMESHFZNc3     505.69
 LME/SHFE LEAD               LMESHFPBc3    2027.55
 LME/SHFE NICKEL             LMESHFNIc3    2268.26
 ($1 = 6.9654 Chinese yuan)

    
 (Reporting by Tom Daly; Editing by Amrutha Gayathri and
Subhranshu Sahu)
  
 
 
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