* U.S. Q1 GDP up 2.5 percent annually, misses forecasts
* Investors square books ahead of China holiday
* Shanghai Futures Exchange shut April 29-May 1
By Susan Thomas and Maytaal Angel
LONDON, April 26 Copper fell more than 2 percent on Friday after
two days of gains as some investors closed their positions ahead of a holiday in
China next week and after U.S. first-quarter growth numbers missed analysts'
Three-month copper on the London Metal Exchange ended down at $7,030
a tonne, after earlier reaching $7,258 a tonne, its highest since April 17.
U.S. first-quarter economic growth expanded at a 2.5 percent annual rate but
missed forecasts for growth of 3 percent and added to market concerns about
demand following signs the economy has weakened in recent weeks.
Market commentators said the data could provide ammunition for the Federal
Reserve to maintain its monetary stimulus.
"We're still up across the board on the week," BNP Paribas analyst Stephen
"There's also a lot of holiday next week in China, so there would have been
China's markets will be closed on Monday, Tuesday and Wednesday next week
for Labour Day holidays.
Copper has rebounded from one-and-a-half-year lows at $6,762.25 a tonne
reached on Tuesday. It was set to close the week up 0.5 percent but was still
down 10 percent for the year, under pressure from rising stocks and poor
"The (industrial metals) sector is well supplied, but there are initial
signs of a pickup in physical consumption. At current price levels, most markets
look undervalued (and) we think downside risks seem somewhat limited," said
Credit Suisse in a note.
Indicating better on-the-ground demand in China, copper inventories in
warehouses monitored by the Shanghai Futures Exchange fell 2.9 percent or 6,483
tonnes from last Friday, the exchange said earlier.
China consumes about 40 percent of the world's copper.
Recent weak economic data have affected the market in two separate ways -
capping gains due to uncertainty about demand from a sluggish global economy but
also providing some support recently after signals that the European Central
Bank could cut rates as soon as next week.
A rate cut by the ECB would not do much to pull the euro zone economy out of
recession, a Reuters poll of 76 economists showed on Thursday.
"Markets generally seem hopeful that policymakers will continue to ease,
starting with the ECB next week," Standard Bank said in a research note.
"The problem now is that a 25 bps cut seems so well discounted that it may
well produce a negative response in risk assets - unless the ECB announces extra
Nickel closed down at $15,200 a tonne from $15,440 at the close on
Thursday, while zinc ended at $1,897 a tonne from $1,936. Lead
closed down at $2,037 from $2,076.5 and aluminium at $1,878 from $1,942.
World unwrought aluminium stocks were at 1.233 million tonnes in March
versus a revised 1.289 million in February, International Aluminium Institute
(IAI) data showed on Friday.
Tin ended down at $20,775 from $21,110.
Metal Prices at 1701 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 317.90 -5.80 -1.79 334.65 -5.01
LME Alum 1878.00 -64.00 -3.30 2230.00 -15.78
LME Cu 7030.00 -150.00 -2.09 7375.00 -4.68
LME Lead 2036.50 -40.00 -1.93 2432.00 -16.26
LME Nickel 15200.00 -240.00 -1.55 18525.00 -17.95
LME Tin 20775.00 -335.00 -1.59 16950.00 22.57
LME Zinc 1897.00 -39.00 -2.01 2560.00 -25.90
SHFE Alu 14670.00 35.00 +0.24 17160.00 -14.51
SHFE Cu* 51940.00 790.00 +1.54 59900.00 -13.29
SHFE Zin 14745.00 75.00 +0.51 21195.00 -30.43
** Benchmark month for COMEX copper
* 3rd contract month for SHFE AL, CU and ZN
SHFE ZN began trading on 26/3/07