LONDON Copper fell on Friday on concern about demand in top metals consumer China ahead of trade and economic growth data next week as the market geared up for its biggest weekly loss in two months.
Three-month copper on the London Metal Exchange, untraded at the close, was last bid at $8,125 a metric tonne, reversing small gains in the previous session when prices rebounded after hitting their lowest in two weeks at $8,105 a tonne.
Copper has drifted in a range of about $8,100-$8,400 a tonne for the past month as investors refocused on underlying demand amid sluggish global growth after the excitement of central bank stimulus measures that sent prices up around 10 percent.
"There's quite a debate out there right now about the extent of the economic slowdown in China and what real impact this is having on metals demand," said Stephen Briggs, metals strategist at BNP Paribas in London.
Chinese trade data, due to be released over the weekend, is expected to show copper imports rising in September from the previous month.
On Thursday, third quarter GDP data is expected to show China's economic growth slowed for a seventh straight quarter to the weakest level since the depths of the global financial crisis.
Lackluster demand in China, which accounts for about 40 percent of global copper consumption, has pressured prices, which are set to fall for the third week out of the past four, sliding about 1.6 percent on the LME.
But Briggs believes copper prices will hold up during the quarter, even though the market is forecast to switch from deficit to surplus next year, due to further central bank stimulus, doubts about potential supply increases and a tight market outside of China where LME stocks are low.
"Although I think it (the surplus) is going to happen, the market is going to need some proof of that and in the interim you can justify prices staying above $8,000," Briggs said.
"I think there is a decent chance that we could get to $9,000 in November, December, but it's a fine call because there will be some downward pressure next year."
In other metals, zinc was due to be the biggest weekly loser among both LME and Shanghai metals. Shanghai zinc dropped 3 percent and the three-month LME contract was on track to shed 6.5 percent.
"Fundamentally the zinc market remains oversupplied, and prospects for mine closures moving the market into deficit have been delayed," said analyst Ric Deverell of Credit Suisse in a note, adding an improvement in demand would be needed to support prices, which look vulnerable.
"The outlook for premiums appears much stronger, but this could lead to weaker flat prices, with smelters relying more on premium revenue, as has been the case with aluminum."
On Friday, LME zinc closed at $1,935 per tonne from $1,967 at the close on Thursday.
Three-month aluminum closed at $1,995 a tonne from a closing bid of $2,015 on Thursday, and nickel closed at $17,075 from $17,725.
Tin closed at $21,315 from $21,900 a tonne and lead at $2,121 from $2,183.
(Additional reporting by Carrie Ho in Singapore; Editing by Robin Pomeroy)