* Copper set to finish first quarter almost 5 percent lower
* Cyprus, Italy remain a drag on metals market
* LME closed on Friday and Monday for Easter holiday
By Susan Thomas
LONDON, March 28 Copper hit a one-week low on Thursday, on
course to end the quarter down almost 5 percent as fallout from a rescue deal
for Cyprus and continuing political problems in Italy kept investors wary of
Prices were set to finish the week with losses of almost 1.5 percent and a
first-quarter fall of 4.9 percent, extending a 3 percent drop seen in the last
quarter of 2012.
Three-month copper on the London Metal Exchange ended kerb trading
down at $7,540 a tonne, from $7,608 at the close on Wednesday, having earlier
hit a low of $7,522.
BNP Paribas analyst Stephen Briggs said events in Europe continued to be a
major driver of the base metals market, not least via the impact on the euro.
"It's not just Cyprus, it's Italy and the continued deadlock about forming a
government, and generally speaking pretty poor data out of Europe. So I think
that's still the main story."
Cyprus opened its banks on Thursday with tight controls in place to prevent
a bank run.
The dollar fell from a recent four-month high against the euro but that
trend was seen as tenuous with investors continuing to fret about ramifications
of the Cyprus bailout and political concerns in Italy.
A strong dollar makes dollar-priced metals costly for European and other
In another restraint on copper, output on the world's biggest producer Chile
rose 2.8 percent in February on improved ore grades and higher output at some
deposits that operated irregularly last year.
In the United States, the number of Americans filing new claims for
unemployment benefits rose last week, but probably not enough to suggest the
laboor market recovery was taking a step back.
Separately, recent data suggests that the housing market recovery is still
on track, helping to underpin copper, which is used extensively in housing.
But the United States accounted for just 9 percent of global primary copper
consumption last year, compared with China's 40 percent. And industry sources
say orders from Chinese buyers have been very modest.
Traders in Asia noted firming premiums for bonded copper stock in Shanghai,
but said consumer appetite remained weaker than last year.
"For consumption, it is not very encouraging news. Seasonally it's slightly
better but not fundamentally," said one trader in Shanghai.
In other metals, aluminium ended down at $1,904 a tonne from $1,916,
lead closed down at $2,112 a tonne from $2,118, having earlier hit a
5-1/2 month low of $2,093; while tin closed up at $23,230 a tonne from
Zinc ended down at $1,897 a tonne from $1,908, having earlier hit an
5-1/2 month low of $1,875. Nickel closed down at $16,660 a tonne from
The LME will be closed on Friday and Monday for the Easter weekend holiday.
Metal Prices at 1728 GMT
Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T
Metal Last Change Pct Move End 2009 Ytd Pct
COMEX Cu 340.40 -3.95 -1.15 334.65 1.72
LME Alum 1904.00 -8.00 -0.42 2230.00 -14.62
LME Cu 7539.50 -68.50 -0.90 7375.00 2.23
LME Lead 2111.50 -6.50 -0.31 2432.00 -13.18
LME Nickel 16660.00 -190.00 -1.13 18525.00 -10.07
LME Tin 23225.00 225.00 +0.98 16950.00 37.02
LME Zinc 1896.50 -11.50 -0.60 2560.00 -25.92
SHFE Alu 14620.00 -45.00 -0.31 17160.00 -14.80
SHFE Cu* 55340.00 -320.00 -0.57 59900.00 -7.61
SHFE Zin 14800.00 -60.00 -0.40 21195.00 -30.17
** Benchmark month for COMEX copper
* 3rd contract month for SHFE AL, CU and ZN
SHFE ZN began trading on 26/3/07