Copper in Shanghai Drops on Concern Over Demand Prospects
Copper in Shanghai declined on speculation that Chinese leaders’ tolerance for a slower growth rate will curb demand growth at the largest user.
Metal for delivery in September fell as much as 1.3 percent to 52,230 yuan ($8,523) a metric ton on the Shanghai Futures Exchange and was at 52,560 yuan at 10:02 a.m. local time. The most-active contract lost 0.2 percent last week, falling for a second week in a row. The London Metal Exchange is closed today for a public holiday.
China’s President Xi Jinping said last week the country won’t sacrifice the environment to ensure short-term growth, while Premier Li Keqiang said growth in the first quarter was “within reasonable range.” A Purchasing Managers’ Index for China released by HSBC Holdings Plc and Markit Economics on May 23 showed a preliminary reading of 49.6 for May, below 50, the expansion level.
“The concern is how demand will be after the peak-consumption season for metals comes to an end, and as leaders become unwilling to add any stimulus,” Xiong Dabiao, an analyst at Minmetals Futures Co., said by phone from Shanghai.
Profits of nonferrous metals mining and smelting companies declined 3.5 percent and 8.3 percent in the first four months from a year ago, according to data from the National Bureau of Statistics today.
The July futures contract on the Comex in New York was little changed at $3.2945 a pound. Net-short positions, or wagers on falling prices, held by funds fell to 9,033 futures and options contracts as of May 21 from 13,115 a week earlier, according to the U.S. Commodity Futures Trading Commission.
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