METALS-Copper falls on strong dollar after upbeat US jobs data

Fri Jul 5, 2013 12:31pm EDT

* Dollar at around 6-week high vs euro

* U.S. employers add 195,000 jobs in June, beats consensus

* Data shows investors sold commodities ETPs in June

By Silvia Antonioli and Harpreet Bhal

LONDON, July 5 (Reuters) - Copper fell for a second day on Friday, under pressure from a stronger dollar after data showed U.S. employers added more jobs than expected in June and on worries over economic growth prospects in China and Europe.

Three-month copper on the London Metal Exchange (LME) ended at $6,780 a tonne, down more than 2 percent from $6,950 at the close on Thursday. It had earlier dipped to a session low of $6,730 a tonne.

Other metals also fell sharply, with nickel dropping to a four-year low.

The dollar extended gains to trade at around a six-week high against the euro after the upbeat figure for U.S. non-farm payrolls. A strong dollar makes commodities priced in the U.S. unit more expensive for holders of other currencies.

U.S. employers added 195,000 jobs to their payrolls last month, suggesting the Federal Reserve would remain on track to scale back monetary stimulus later this year.

INTL FCStone analyst Edward Meir said that, while the data has been positive for the dollar, the metals market remained pressured by uncertainty about the outlook for economic growth and metals demand.

"I think base metals are still more preoccupied with what is going on in China as opposed to the Fed," he said.

Recent weak economic data from China, the world's largest copper consumer, has raised concerns about the outlook for demand for the metal used in power and construction.

Concerns about Europe's economic health were also pressuring metals prices after European Central Bank President Mario Draghi said that growth risks there were on the downside.

"Mario Draghi's press conference yesterday showed that the prospects for growth in Europe are still very slim, and we see continued negative tone in the news from China where the government seems to be well oriented to a slowdown," Eugen Weinberg, an analyst at Commerzbank, said.

Data showed investors were net sellers of commodity exchange-traded products (ETPs) in June after the U.S. Federal Reserve signalled it would wind down stimulus.

In other metals, nickel closed at $13,300 from $13,825, having earlier fallen to $13,298, its lowest level since late May 2009. Tin ended at $18,850 from $20,000 while zinc, used to galvanise steel, ended at $1,740 from $1,861 at Thursday's close.

Lead closed at $2,030 from $2,074, aluminium , untraded at the close, was bid at $1,768 from $1,812.

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.