Shanghai - Copper fell after weak Chinese industrial production and fixed asset investment increased concerns over an economic slowdown in the world’s largest consumer. All industrial metals retreated.
The metal used in pipes and wires lost 1 percent to $5 318 a metric ton by 3:28 pm Shanghai time. It follows a 4.9 percent increase last week, the biggest such gain since May
China’s economic growth remains stuck below the government’s target of about 7 percent this year. Bloomberg’s monthly gross domestic product tracker was at 6.64 percent last month, barely changed from July. Industrial output released Sunday missed economists’ forecasts, while investment in the first eight months increased at the slowest pace since 2000. The Shanghai Composite Index of shares closed 2.7 percent lower, having fallen as much as 4.7 percent.
“The weak output data reflect the challenges China is facing,” Li Qi, the chief metals analyst at Cofco Futures, said by phone from Shanghai. “It also brings hope that the authorities will seek to cushion the slowdown with massive projects.” While copper dropped on Monday, the metal still has the best fundamentals because of supply disruptions, Li said.
Copper’s rally “may be getting ahead of itself,” Barclays analysts said in a report dated Monday, adding that demand hasn’t been strong enough to suggest a turnaround in China.
Copper futures for December on the Comex in New York declined 1.4 percent to $2.4205 a pound, while November contracts in Shanghai declined 1.3 percent to close at 40 620 yuan ($6 378) a ton.
The six base metals on the London Metal Exchange fell by at least 0.7 percent, with nickel falling 1.7 percent.Bloomberg