Copper falls in NY on concern slowing growth will curb demand
Monday, 19 July 2010
NEW YORK, July 18 (Bloomberg): Copper futures in New York fell the most in two weeks on concern that a slowing global economy will limit demand for metal used in homes, cars and appliances.
US manufacturing contracted in June by the most in a year, and second-quarter growth slowed in China, according to separate reports this week. China and the US are the world's top metals users. Copper prices have slumped 12 per cent this year.
"The fears of a double-dip recession are still out there," said Matthew Zeman, a trader at LaSalle Futures Group in Chicago. "We're not going to see a whole lot of upside from copper in the near term."
Copper futures for September delivery fell 8.25 cents, or 2.7 per cent, to $2.9295 a pound on the Comex in New York. That marked the biggest drop for a most-active contract since June 29 and put this week's decline at 4.1 per cent.
A Labor Department report Friday showed the cost of living in the US fell in June for a third straight month. The consumer-price index slipped 0.1 per cent, dragged down by plunging energy costs.
"People are still worried about deflation and what that will mean for the commodities," Zeman said.
Confidence among US consumers tumbled in July to the lowest level in a year, according to the Thomson Reuters/University of Michigan index of sentiment. Consumer spending accounts for 70 per cent of the US economy.
"The slow recovery in demand outside China, coupled with growing concerns over the global economic recovery, will keep a check on copper prices," First Global analysts, led by London- based Chief Investment Strategist Devina Mehra, said Friday in a report.
On the London Metal Exchange, copper for delivery in three months lost $195, or 2.9 per cent, to $6,485 a metric tonne ($2.94 a pound).
US manufacturing contracted in June by the most in a year, and second-quarter growth slowed in China, according to separate reports this week. China and the US are the world's top metals users. Copper prices have slumped 12 per cent this year.
"The fears of a double-dip recession are still out there," said Matthew Zeman, a trader at LaSalle Futures Group in Chicago. "We're not going to see a whole lot of upside from copper in the near term."
Copper futures for September delivery fell 8.25 cents, or 2.7 per cent, to $2.9295 a pound on the Comex in New York. That marked the biggest drop for a most-active contract since June 29 and put this week's decline at 4.1 per cent.
A Labor Department report Friday showed the cost of living in the US fell in June for a third straight month. The consumer-price index slipped 0.1 per cent, dragged down by plunging energy costs.
"People are still worried about deflation and what that will mean for the commodities," Zeman said.
Confidence among US consumers tumbled in July to the lowest level in a year, according to the Thomson Reuters/University of Michigan index of sentiment. Consumer spending accounts for 70 per cent of the US economy.
"The slow recovery in demand outside China, coupled with growing concerns over the global economic recovery, will keep a check on copper prices," First Global analysts, led by London- based Chief Investment Strategist Devina Mehra, said Friday in a report.
On the London Metal Exchange, copper for delivery in three months lost $195, or 2.9 per cent, to $6,485 a metric tonne ($2.94 a pound).