Copper falls as investors weigh increasing exchange inventories
By Bloomberg
Copper traded near a six-month low after stockpiles in exchanges
from London to Shanghai increased and as Goldman Sachs Group Inc.
forecast inventories will rise further over the next six
months.
The metal in London retreated as much as 0.7 percent after touching
the lowest since April 15 last week. A once-in-20-year supply
cycle, seasonal factors and a lack of China demand for financing
deals will result in a major build in London Metal Exchange over
the next six months, Goldman Sachs said in a report dated Oct.
17.
China's central bank is planning to inject about 200 billion yuan
($32.7 billion) into lenders as Communist Party leaders gather for
a plenum this week. The world's largest metal consumer probably
grew at 7.2 percent in the third quarter, down from 7.5 percent in
the previous three months, according to Bloomberg News survey
before data tomorrow.
"Copper has lost some ground on poor fundamentals," said Chae Un
Soo, a metals trader at Korea Exchange Bank Futures Co. "Investors
are focusing on a surplus next year and China's slowing
economy."
Global refined copper output will exceed demand by 162,000 metric
tons next year compared with a deficit of 176,000 tons in 2014,
Vanessa Davidson, copper group manager at London-based researcher
CRU, said in an interview Oct. 14.
The metal for delivery in three months in London slid 0.5 percent
to $6,604.25 a ton at 3:12 p.m. in Tokyo after touching $6,530 on
Oct. 17. Stockpiles tracked by the LME rose 5.5 percent last week,
the most since the week ended March 21.
Inventories monitored by the Shanghai exchange increased 17 percent
last week.
In New York, futures for December delivery fell 0.3 percent to
$2.9935 a pound in New York. In Shanghai, copper for the same month
rose 0.7 percent to close at 47,070 yuan ($7,686) a ton.
On the LME, aluminum, nickel, tin and lead rose, while zinc was
little changed.