May 2, 2018 / 2:32 AM / 18 days ago

METALS-Copper bounces off one-month low after firm China factory data

 (Updates prices)
    By Manolo Serapio Jr
    MANILA, May 2 (Reuters) - London copper futures recovered
from their weakest level in nearly a month on Wednesday after a
private survey showed growth in China's manufacturing sector
unexpectedly picked up in April, brightening the demand outlook
in the top user of the metal.
    Three-month copper on the London Metal Exchange was
up 1.5 percent at $6,849 per tonne by 0706 GMT, after hitting a
low of $6,710 on Tuesday, its weakest since April 4. 
    The Caixin/Markit Manufacturing Purchasing Managers' index
(PMI) climbed to 51.1 in April from a four-month low of 51.0 in
March, and topped economists' forecast for a modest slowdown to
50.9.
    But the same survey showed a sub-index on export orders
shrinking for the first time since November 2016. An official
PMI survey on Monday also showed slower shipment orders last
month.
    The data "reflects a deteriorating export market and 
strengthened domestic consumption" that may cancel each other
out and keep gross domestic product growing at 6.5 percent this
year as Beijing had forecast, said Helen Lau, analyst at
Argonaut Securities.
    "For the rest of the year, as the export situation may
deteriorate, fiscal stimulus and further monetary easing will 
likely take place so as to protect the 6.5 percent growth
target, which in turn will underpin growth for commodity
demand," Lau said in a note.
    
    SHANGHAI COPPER: The most-traded June copper contract on the
Shanghai Futures Exchange slipped 0.8 percent to close
at 51,190 yuan ($8,046) a tonne, tracking losses in London in
the prior session as Chinese markets reopened after a two-day
public holiday.
    FEDERAL RESERVE: Investors are also awaiting the statement
from the U.S. Federal Reserve when its two-day policy meeting
concludes later on Wednesday. While the Fed is widely expected
to keep the benchmark interest rate on hold, it looks certain to
raise it again next month, given signs of possible acceleration
in the U.S. economy.
    U.S. RESTRICTIONS: U.S. officials are pushing for quotas and
"other restrictions" on steel and aluminium imports, a top trade
official said after the White House announced a month-long
extension of tariff exemptions for Canada, Mexico and the
European Union.
    RUSAL: The U.S. Treasury gave investors an additional month
to divest or transfer their holdings in sanctions targets major
aluminium producer United Company Rusal Plc, En+ Group
Plc and GAZ Group.
    RIO TINTO: The U.S. Treasury's move may greatly reduce the
restrictions on Rusal, Rio Tinto Chief
Executive Jean Sebastien Jacques said. Rio Tinto, which buys
from and sells to Rusal and jointly owns an alumina refinery in
Australia, said last month it would declare force majeure on
some contracts following the sanctions on Rusal.
    ALUMINIUM: LME aluminium eased 0.8 percent to $2,243
a tonne while its Shanghai counterpart ended down 0.3
percent at 14,430 yuan.
    OTHER METALS: LME nickel rose 2.1 percent to $13,935
a tonne and zinc climbed 1.9 percent to $3,110. In
Shanghai, nickel advanced 0.8 percent to 105,100 yuan
per tonne and zinc gained 0.2 percent to 23,900 yuan.
    MARKETS: The dollar held near a four-month high against a
basket of major currencies, buoyed by the outlook for a strong
U.S. economy and rising yields amid signs of slowdown elsewhere,
especially in Europe. Asian shares slipped.  
 
        
                                                      0706 GMT
 Three month LME copper                                   6849
 Most active ShFE copper                                 51190
 Three month LME aluminium                                2243
 Most active ShFE aluminium                              14430
 Three month LME zinc                                     3110
 Most active ShFE zinc                                   23895
 Three month LME lead                                   2329.5
 Most active ShFE lead                                   18585
 Three month LME nickel                                  13935
 Most active ShFE nickel                                105100
 Three month LME tin                                     21205
 Most active ShFE tin                                   147290
                                                              
                                                              
 LME/SHFE COPPER                   LMESHFCUc3           511.57
 LME/SHFE ALUMINIUM                LMESHFALc3         -2039.45
 LME/SHFE ZINC                     LMESHFZNc3           207.04
 LME/SHFE LEAD                     LMESHFPBc3           299.94
 LME/SHFE NICKEL                   LMESHFNIc3          -495.06
 
($1 = 6.3622 Chinese yuan)

    
 (Reporting by Manolo Serapio Jr.; Editing by Gopakumar Warrier)
  
 
 
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