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METALS-LME copper comes off 1-week high; China stimulus eyed
July 16, 2012 / 5:43 AM / 5 years ago

METALS-LME copper comes off 1-week high; China stimulus eyed

* Metals prices ease as buyers turn to agricultural futures
-trade
    * China pledges efforts to stabilise economy in H2
    * Investors eye Euro zone trade data for May

 (Updates prices; adds quotes, details)
    By Carrie Ho
    SHANGHAI, July 16 (Reuters) - London copper edged down on
Monday after hitting a one-week high in the prior session as
surging agricultural futures drew some buying power away from
base metals, but expectations of further stimulus from China
helped put a floor under prices.
    China's Premier Wen Jiabao said on Sunday that the
government would step up efforts to boost the economy of the
world's largest metal consumer, after data showed its economy
slowed for the sixth successive quarter to expand by 7.6 percent
in the April-June quarter. 
    Any moves by Beijing to ramp up infrastructure spending
would bolster demand for industrial metals, especially copper.
    Three-month copper on the London Metal Exchange 
inched down 0.2 percent to $7,685 per tonne by 0410 GMT.    
Prices had rallied 1.9 percent to a one-week high at $7,730 on
Friday.
    "London base metals have fallen this morning as Chinese
investors are sidetracked b y trading in agricultural products
such as soybeans and soybean meal," said a Shanghai-based
commodities broker. 
    The most-active October copper contract on the Shanghai
Futures Exchange rose 0.7 percent to 56,130 yuan
($8,800) per tonne, catching up with London's previous gains.
    "There's a lot of latent buying power out there waiting for
the right time to enter the base metals markets as many expect
more stimulus by Beijing soon," the broker said. 
    "I've advised my clients to cut short positions and be ready
to take up fresh long positions," he added.
    During a tour of Sichuan province, Chinese Premier Wen said
that the government would "increase efforts to preset and
fine-tune its policies" to help combat risks that lie ahead for
the world's second-largest economy.
    Comments by state-backed media on Monday also suggested that
a slew of pro-growth measures could be unveiled as early as
Wednesday, with economists expecting Beijing to boost investment
spending to sustain growth. [ID: 
    Still, a technical analysis of Shanghai copper showed that
prices would likely be trapped in a range of 54,940-56,380 yuan
per tonne. 
    Underlying concerns over the global economy may also cap
base metals, after U.S. consumer sentiment cooled again in early
July to its lowest level in seven months. 
    In the euro zone, Italy is still cause for worries after
Moody's two-notch cut in its sovereign debt rating to two levels
above junk and after its 10-year bond yields rose on Friday,
underscoring concerns that Europe's third-largest economy could
fall victim to the spreading debt crisis.       
                                                               
  Base metals prices at 0410 GMT
  Metal              Last       Change   Pct Move YTD pct chg
  LME Cu            7685.00    -15.00     -0.19      1.12
  SHFE CU FUT OCT2    56130       360     +0.65      0.90
  LME Alum          1907.25     -2.75     -0.14     -5.58
  SHFE AL FUT OCT2    15590        70     +0.45     -1.58
  HG COPPER SEP2     348.90     -1.50     -0.43      1.54
  LME Zinc          1870.50     -3.50     -0.19      1.38
  SHFE ZN FUT OCT2    14800        15     +0.10      0.03
  LME Nickel       16188.00    -12.00     -0.07    -13.48
  LME Lead          1879.75     -0.25     -0.01     -7.63
  SHFE PB FUT         14955        -5     -0.03     -2.19
  LME Tin          18780.00      0.00     +0.00     -2.19
  LME/Shanghai arb    1193
 
   Shanghai and COMEX contracts show most active months
   ^ LME 3-m copper in yuan, including 17 pct VAT, minus SHFE 
 third month
 ($1 = 6.3789 Chinese yuan)

 (Reporting by Carrie Ho; Editing by Ed Davies)

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