Reuters: US Dollar Report: METALS-Copper drops on growth fears, c.bank easing hopes cap falls

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METALS-Copper drops on growth fears, c.bank easing hopes cap falls Apr 30th 2013, 08:40 Tue Apr 30, 2013 4:40am EDT * Copper down 5.6 pct so far in Apr, biggest monthly loss since May * China markets to remain closed until Thursday * Coming up: U.S. Chicago PMI for April at 1345 GMT By Harpreet Bhal LONDON, April 30 (Reuters) - Copper fell on Tuesday, on track for its steepest monthly loss in nearly a year, as concerns about the pace of global growth weighed on industrial metals, but falls were capped by hopes of more monetary easing. Benchmark three-month copper on the London Metal Exchange fell to $7,117.25 a tonne at 0828 GMT, down 0.5 percent from a close of $7,153.50 a tonne on Monday. Volumes were subdued as China's markets will remain closed until Thursday for Labour Day holidays. The metal used in power and construction is down 5.6 percent so far this month, on course for its biggest monthly fall since May last year. It fell to a 1-1/2 year low of $6,762.25 last week. Investors have been shying away from commodities on fears that more falls could be in store after prices plunged in April. "We had a decent rebound for copper after the falls (in early April) so I am not surprised to see some profit taking," said Andrey Kryuchenkov, analyst at VTB Capital. "The market is sitting tight ahead of Chinese manufacturing PMI data this week, and rate decisions by the ECB and Fed. Ahead of that we don't expect any big movements and volumes are expected to remain thin." Speculation is rife that the European Central Bank (ECB) will cut interest rates at its policy meeting on Thursday given the dreary run of economic news from the region. The U.S. Federal Reserve also meets this week and is widely expected to keep its current pace of bond buying at $85 billion a month. The policy-setting Federal Open Market Committee will announce its decision on Wednesday. Also weighing on metals prices was a drop in the euro against the dollar. A strong dollar makes commodities priced in the U.S. unit more expensive for holders of other currencies. COST PRESSURE A pickup in copper demand from China is anticipated after Chinese markets reopen later this week. "We still believe that copper prices will move higher into the middle of the year because of improving demand in China," said analyst Bonnie Liu at Macquarie in Singapore. In industry news, miners have stepped up job and spending cuts as companies face lower prices and falling revenue growth. Mining group Rio Tinto plans to almost halve the size of its London head office, axing more than 200 jobs as it tries to slash more than $5 billion in costs by the end of next year. Three Canadian gold and silver miners also announced cost cutting on Monday. Elsewhere, Newmont Mining Corp, the largest U.S.-based gold miner, reported a sharper-than-expected drop in first-quarter profit on Monday, as gold and copper shipments fell more than 10 percent and realised prices for the metals slid. Soldering metal tin slipped to $20,850 from a close of $20,895 on Monday, while zinc, used in galvanising, fell to $1,897.25 from $1,907. Battery material lead was flat at $2,044, aluminium slipped to $1,893.75 from $1,899, while nickel was at $15,430 from $15,500 a tonne on Monday. Metal Prices at 0828 GMT Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T Metal Last Change Pct Move End 2012 Ytd Pct move COMEX Cu 322.70 0.15 +0.05 365.25 -11.65 LME Alum 1897.75 19.75 +1.05 2073.00 -8.45 LME Cu 7130.25 100.25 +1.43 7931.00 -10.10 LME Lead 2045.00 8.00 +0.39 2330.00 -12.23 LME Nickel 15442.00 242.00 +1.59 17060.00 -9.48 LME Tin 20850.00 75.00 +0.36 23400.00 -10.90 LME Zinc 1900.25 3.25 +0.17 2080.00 -8.64 SHFE Alu 14670.00 35.00 +0.24 15435.00 -4.96 SHFE Cu* 51940.00 790.00 +1.54 57690.00 -9.97 SHFE Zin 14745.00 75.00 +0.51 15625.00 -5.63 ** Benchmark month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN Link this Share this Digg this Email Reprints

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