August 12, 2011 / 3:20 PM / 6 years ago

METALS-Copper posts 2nd straight weekly loss, tin rallies

 * Copper eases as global economic worries persist
 * U.S. consumer sentiment falls to lowest in three decades
 * Signs of pick-up in H2 Chinese copper imports-Codelco
 * Coming up: U.S. housing data on Tuesday
 (Recasts, updates prices, market activity to New York close; adds second
byline, dateline, previously LONDON)
 By Chris Kelly and Pratima Desai
 NEW YORK/LONDON, Aug 12 (Reuters) - London copper prices ended a shade
lower on Friday as global economic growth fears lingered and Chinese demand
prospects remained unclear, but copper in New York crept up with equities to
end less than a penny higher from the previous session.
 With investors still worried about the global economy, losses stretched
across the base metals complex, continuing the overwhelmingly bearish broader
market tone over the past two weeks. The exception was tin, which rallied as
much as 5 percent at one point during the session on worries about restricted
supplies from Indonesia, the world's largest exporter.
 Copper posted its first back-to-back weekly decline since early June, with
total weekly trading volumes in New York up near their late-February record of
319,000 lots. (Graphic: )
 Despite the global economic turmoil, Diego Hernandez, the chief executive
of Chile's giant copper miner Codelco [CODEL.UL], remained "optimistic" that
copper prices will remain at current levels until year-end, eyeing an uptick in
second-half Chinese copper cathode imports. [ID:nSGO002285] [ID:nSGO002286]
 Looking ahead into the coming week, metals are likely to remain tied to
fluctuations in equities markets and could be affected by a stream of U.S.
housing data. Short-term direction is likely to be muddied by thin trading
during widespread holidays in most of mainland Europe on Monday.
 "The wild swings in the equity markets are bound to continue at least for
some time longer, making short-term forecasting even more difficult," analyst
Ed Meir of MF Global said.
 London Metal Exchange (LME) benchmark copper CMCU3 eased $16 to end at
$8,865 a tonne, but managed to claw back from a weekly trough at $8,446.25, its
lowest since early December of last year.
 In New York, the key September COMEX contract HGU1 eked out a 0.35-cent
gain to settle at $4.0120 per lb, supported by a firmer tone in equity markets
and mildly encouraging retail sales in July, which helped to offset the weak
consumer sentiment data. [.N]
 U.S. consumer sentiment in early August dropped to its lowest level since
1980 as fears of a stalled recovery combined with despair over government
policies, a survey released on Friday showed. [ID:nN1E77B08W]
 "Any optimism is premature. We are not out of the woods yet, the economic
path from now on is unclear," said Eugen Weinberg, commodities analyst at
Commerzbank. "We've seen some bargain hunting, probably from the Chinese."
 But it is uncertain to what extent China, which accounts for nearly 40
percent of global copper demand estimated at around 19 million tonnes this
year, will come back to the market this year.
 A slowdown in China rail investments, reports that China is cutting its
target for the construction of public homes and the general impact of its
tightening measures have all fueled concerns about the outlook for metals
demand. [ID:nLDE77306U] [ID:nL3E7JB0J1]
 "All these little bits are adding up," said David Wilson, an analyst at
Societe Generale.
 "There's plenty of copper in China. European consumer spending has fallen.
I think people in Europe are going to be cutting back expenditure over the next
few months because of nervousness about the state of growth," he added.
 Global metal stocks:
 LME stocks vs prices
 In other metals, aluminium CMAL3 ended down $13 at $2,400 a tonne, with a
lack of physical business compounding the softer market tone.
 A physical trader said premiums have not changed in weeks, quoted at around
$200-230 for duty-paid.
 "It's the same as last week and the week before and the week before. It's
just dead quiet," he said, adding that the massive influx into Vlissingen isn't
having much of an impact on premiums. [ID:nL6E7JA0T2] [ID:nL6E7JB1F7]
 Tin CMSN3 rallied 5 percent to a one-week high at $24,950 a tonne at one
point on after Indonesia said it would impose a new royalty charge on all tin
shipments and only allow the export of refined tin. [ID:nL3E7JC1RG]
 It ended bid at $24,650 from $23,605 on Thursday.
 Metal Prices at 1802 GMT
 Metal            Last      Change  Pct Move   End 2010   Ytd Pct
 COMEX Cu       401.05        0.20     +0.05     444.70     -9.82
 LME Alum      2399.00      -14.00     -0.58    2470.00     -2.87
 LME Cu        8865.00      -16.00     -0.18    9600.00     -7.66
 LME Lead      2380.00       -5.00     -0.21    2550.00     -6.67
 LME Nickel   21400.00     -200.00     -0.93   24750.00    -13.54
 LME Tin      24650.00     1045.00     +4.43   26900.00     -8.36
 LME Zinc      2176.00      -10.00     -0.46    2454.00    -11.33
 SHFE Alu     17440.00     -195.00     -1.11   16840.00      3.56
 SHFE Cu*     66460.00     -250.00     -0.37   71850.00     -7.50
 SHFE Zin     16845.00       65.00     +0.39   19475.00    -13.50
** Benchmark month for COMEX copper
* 3rd contract month for SHFE AL, CU and ZN
SHFE ZN began trading on 26/3/07
 (Additional reporting by Melanie Burton in London; editing by Jane Baird,
Sofina Mirza-Reid and David Gregorio)

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