US copper sinks to 6-mth low amid commods sell-off
NEW YORK, Aug 4 (Reuters) - The price of copper fell to a six-month low in New York futures trade on Monday as a broad sell-off in commodities added further pressure to the red metal, already struggling from a weaker demand outlook.
NOTE: For detailed report, click on [MET/L].
* Copper for September delivery HGU8 fell as much as 15.25 cents, or nearly 4.3 percent, to $3.4260 a lb on the the New York Mercantile Exchange's COMEX division, its lowest level since Feb. 7.
* The benchmark September contract settled down 13.85 cents at $3.44.
* Technical selling added further pressure to the correction after sell-stop orders were triggered at the September contract's 200-day moving average at $3.5350, and the June 12 low at $3.51 - trader.
* "On a continuation move lower, our expectations are down at levels closer to $3.20 (a lb) at this point," said David Meger, Alaron Trading metals analyst.
* Copper down on economic slowdown fears and seasonality concerns, highlighted by steady builds in London warehouses and waning demand growth from Chinese buyers ahead of the Beijing Olympic Games.
* "It is hard to be fundamentally positive about base metals at the moment for a mixture of macro and seasonal reasons. Base metals could struggle to move sharply lower from here," said John Reade, analyst with investment bank UBS.
* China's manufacturing sector contracted in July for the first time since the survey began in 2005, while European manufacturing also showed contraction, and flat U.S. manufacturing and weak nonfarm payrolls and auto sales suggested less demand for industrial metals.
* "After several years where the focus has been mainly on tight metal supplies, it seems the markets are finally focusing more on the implications of rapidly weakening demand." - MF Global analyst Edward Meir.
* Overnight inventory data showed London Metal Exchange (LME) warehouse stocks up 1,550 tonnes to 146,200 tonnes on Monday. Stockpiles are up nearly 24,000 tonnes during the month of July.
* COMEX copper stocks eased 23 short tons to 6,300 short tons on Friday.
* The noncommercial position in COMEX copper futures turned net short by 2,242 contracts for the week ended July 29, against a net long of 993 contracts for the week to July 22 - The Commodity Futures Trading Commission. [ID:nN01373110]
* COMEX estimated final futures volumes at 27,333 lots, compared with Friday's official count at 19,550 lots.
* Open interest eased 410 lots to 109,629 open contracts as of August 1.
* On the production front, Peru's copper output rose 9.43 percent to 103,669 tonnes in June from the same month a year earlier.
* Rio Tinto Ltd/Plc (RIO.AX)(RIO.L) will invest $341 million for more pre-feasibility studies on a copper deposit at its Resolution Copper Mining operation in Arizona. [ID:nSYY004854]
* LME copper for delivery in three-months MCU3 hit an intraday low at $7,601 a tonne, its lowest since Feb. 8, before ending at $7,610, down $290 from Friday's close. (Reporting by Chris Kelly)
