METALS-Copper snaps 3-day fall on upbeat US, Chinese data

Fri Feb 8, 2013 12:28pm EST

* China exports, imports surge, surpass market expectations

* China copper imports rise 3 pct in January vs December

* Trade data suggest US economy in better shape than expected

By Susan Thomas and Silvia Antonioli

LONDON, Feb 8 (Reuters) - Copper rose on Friday for the first time in four days on a softer dollar and strong trade data from China and the United States, which signalled improved economic growth and brighter prospects for metals demand.

Three-month copper on the London Metal Exchange closed at $8,295 a tonne, up 1.16 percent on the day.

China's exports jumped 25 percent in January from a year earlier, topping market forecasts for an increase of 17 percent, while imports surged 28.8 percent, also ahead of the analysts' estimate of 23.3 percent.

The sharp rise was partly due to the Lunar New Year effect, with the holiday falling in January of last year, but the "numbers are still very strong and show the economic recovery is on track", said Zhang Zhiwei, chief China economist at Nomura in Hong Kong.

Trade data from the Unites States was also supportive for assets such as metals that are perceived as riskier.

The U.S. trade deficit shrank in December to its narrowest in nearly three years, suggesting the economy did much better in the fourth quarter than initially estimated.

"The U.S. trade deficit number should be supportive for metals as it shows that things are going well in the U.S., and you have got the dollar marginally weaker today - that has also been supportive," said Randy North, director at RBC Capital Markets.

The dollar was down slightly against a basket of currencies. A softer dollar makes metals less expensive for investors using alternative currencies.

The upbeat data boosted other risk assets including equities and oil.

CHINESE COPPER IMPORTS

China, which accounts for around 40 percent of refined copper demand, imported 350,958 tonnes of copper in January, up almost 3 percent from December as importers brought forward shipments to avoid delays during next week's week-long holiday.

"China imports of copper in January were up slightly on the December figure but down over 15 percent on a year ago," Commerzbank said in a research note.

"One reason for trading volumes remaining modest is no doubt the imminent Lunar New Year celebrations in China. Chinese traders have evidently been scaling down their activities in the run-up to this holiday. We expect imports to start rising again in March, parallel to higher seasonal demand, which should support copper prices in the medium term."

In other metals, three-month tin closed at $24,850, up from $24,675 at Thursday's close, while zinc finished at $2,205 from $2,163.

Three-month lead closed at $2,422 from $2,408, and aluminium , untraded at the close, was last bid at $2,119 from a last bid of $2,098 on Thursday.

Boosting sentiment in the aluminium market, Russia's United Company RUSAL Plc, the world's top aluminium producer, said it expected 2013 global aluminium demand to rise 6 percent, fuelled by investment in large-scale infrastructure projects in China.

Stainless steel material nickel closed at $18,315 from $18,180.

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