Funds News

METALS-Copper heads for biggest weekly gain since February

(Updates prices)

LONDON, April 16 (Reuters) - Copper fell on Friday but was still on track for its biggest weekly rise in two months after solid U.S. and Chinese economic data pushed global stock markets to record highs and several investment banks predicted higher prices for the metal.

However the numbers from China, the biggest consumer of metals, were a mixed bag, with factory activity growing strongly but below forecasts and expected to slow.

Benchmark copper on the London Metal Exchange (LME) was down 1% at $9,190.50 a tonne at 1712 GMT but still up around 3% this week and near February’s peak of $9,617, the highest since 2011.

“The Chinese data are only really good at first glance ... momentum has cooled to some extent,” Commerzbank analyst Daniel Briesemann said.

Optimism on stock markets was a support for metals and strong demand during the second quarter - China’s traditional construction season - could lift copper further in the short term, but prices would fall later in the year, Briesemann said.

CHINA: The economy grew by a record 18.3% year-on-year in the first quarter, but the expansion is expected to moderate later this year. Industrial output slowed in March to 14.1%.

U.S: Stellar homebuilding numbers added to robust data on Thursday that underscored brightening U.S. economic prospects.

OUTLOOK: Goldman Sachs this week raised its 12-month target for copper to $11,000 a tonne, while Citi recommended clients take on bullish copper exposure over the next few weeks.

MARKETS: European, U.S. and global equities reached record highs while oil prices rose above $67 a barrel.

ALUMINIUM: LME aluminium was down 0.9% at $2,318.50 a tonne after data showed China’s March aluminium output rose to a monthly record.

Aluminium hit a three-year high of $2,359 on Thursday, in part due to expectations that a Chinese anti-pollution drive would curtail aluminium production capacity.

OTHER METALS: LME zinc was down 0.3% at $2,855.50 a tonne, nickel fell 0.1% to $16,345, lead gained 0.9% to $2,035, and tin was 0.9% higher at $26,585.

Reporting by Peter Hobson; Additional reporting by Mai Nguyen; Editing by David Holmes, Kirsten Donovan