Copper rises on brighter China factory data
Copper prices increase in London on positive indications China's economy may have stabilised
London copper climbed on Thursday from the near one-week lows touched the session before, boosted by improving manufacturing growth in the world’s No1 metals consumer China.
Activity in China’s giant manufacturing sector picked up in October, a preliminary survey showed on Thursday, suggesting the economy may have stabilised, though a strong rebound remains elusive.
“The big question people are looking at now is what happens in the fourth quarter."
But the market remains concerned about a cash crunch in the world’s second biggest economy after China’s central bank declined to inject cash for a third day.
“The big question people are looking at now is what happens in the fourth quarter,” said analyst Ivan Szpakowski of Citi in Shanghai.
“Our view is that it will be slower and a lot of that is basis credit tightening since Q2 and because of that we’re expecting slower growth and that does feed into our bearish copper view.”
Three-month copper on the London Metal Exchange was trading up 0.53 per cent at US$7,209 a tonne by 07.12 GMT, after falling 2.2 per cent the session before.
Copper prices slid to US$7,170 a tonne on Wednesday, the lowest since October 14. Prices have traded in a US$7,000-7,420 band since late August and remain down by more than 9 per cent for the year.
