Copper dropped by the most in a week, leading industrial metals lower, after a manufacturing gauge for China declined more than estimated, damping demand prospects in the world’s biggest user of metals.
The contract for delivery in three months on the London Metal Exchange retreated as much as 0.9 percent to $7,117.50 a metric ton, the biggest loss since Feb. 13, and was at $7,127 at 4 p.m. in Tokyo. Copper has fallen 3.2 percent this year, extending a 7.2 percent slump last year.
The preliminary February reading of 48.3 for a Purchasing Managers’ index released today by HSBC Holdings Plc and Markit Economics compares with January’s final figure of 49.5 and the 49.5 median estimate in a Bloomberg News survey of economists. A number below 50 indicates contraction.
“The PMI data was worse than expected,” said Kazuhiko Saito, an analyst at Fujitomi Co., a commodities broker in Tokyo. “Copper was pressured by concern that China’s growth is weakening.”
The world’s second-biggest economy reduced its 2014 forecast for expansion in factory output to about 9.5 percent, from last year’s 10 percent, Mao Weiming, deputy minister at the Ministry of Industry & Information Technology, said Feb. 18.
The contract for May delivery on the Comex in New York slid 0.8 percent to $3.246 a pound. The metal for delivery in May on the Shanghai Futures Exchange fell 0.6 percent to close at 50,390 yuan ($8,282) a ton.
On the LME, aluminum, zinc, tin, nickel and lead also declined.