March 17, 2020 / 3:40 AM / 13 days ago

METALS-London copper recovers slightly after hitting 40-month trough

SINGAPORE, March 17 (Reuters) - London copper prices recovered slightly on Tuesday after falling to a 40-month low in the previous session, as investors bet that U.S. Federal Reserve’s policy measures would help boost demand for metals in the long term.

Three-month copper on the London Metal Exchange (LME) was up 0.5% at $5,315 a tonne by 0240 GMT, having fallen to its lowest since November 2016 on Monday.

“(The) Fed’s latest cut in interest is a very strong liquidity injection. Generally a low interest environment in longer run brings base metal business cycle back,” said a Singapore-based metals trader, referring to the U.S. Federal Reserve.

The U.S. central bank cut interest rates to near zero on Sunday and pledged to expand its balance sheet by at least $700 billion in the coming weeks, but that did little to calm investor panic over the deepening economic hit from the virus.

“After one day of panic selling, some market participants start to expect a rebound, especially Asian traders who have witnessed the effective control in countries like China, Singapore and South Korea,” the trader added.

LME nickel advanced 2.5% to $12,230 a tonne, zinc rose 0.6% to $1,953.50 a tonne, lead edged up 0.3% to $1,732 a tonne, while tin increased 0.5% to $15,375 a tonne.

FUNDAMENTALS

* STIMULUS: Australia, Canada and New Zealand recently announced new measures to help arrest the economic impacts of the fast-spreading coronavirus.

* HYUNDAI: Hyundai Motor’s China domestic plant sales in February dropped 97% from a year ago.

* OYU TOLGOI: Work at Rio Tinto Ltd’s Oyu Tolgoi copper-gold mine in Mongolia has slowed because of government measures against the coronavirus.

* For the top stories in metals and other news, click or

MARKETS NEWS

* Asian shares fell on Tuesday in a topsy-turvy session following one of Wall Street’s biggest one-day routs in history as headlines about the coronavirus outbreak and its global economic impact whiplashed investor sentiment.

DATA/EVENTS (GMT)

0930 UK Claimant Count Unem Chng Feb

0930 UK ILO Unemployment Rate Jan

1000 Germany ZEW Economic Sentiment March

1000 Germany ZEW Current Conditions March

1230 US Retails Sales MM Feb

1315 US Industrial Production MM Feb

PRICES

Three month LME copper

Most active ShFE copper

Three month LME aluminium

Most active ShFE aluminium

Three month LME zinc

Most active ShFE zinc

Three month LME lead

Most active ShFE lead

Three month LME nickel

Most active ShFE nickel

Three month LME tin

Most active ShFE tin

ARBS (Reporting by Mai Nguyen; Editing by Aditya Soni)

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