Copper dips, near 4-1/2-year low on Chinese growth concerns * London copper eases to trade near 4-1/2-year low * China Dec factory PMIs suggest economy cooling further * Copper prices may have hit the floor - analyst London copper started new year trading with a bearish tone on Friday, falling for a second consecutive session to hover around 4-1/2-year lows because of expected pressure from surplus supplies and slow growth in top consumer China. Three-month copper on the London Metal Exchange fell 0.2 percent, or $14, to $6,286 a tonne as of 0314 GMT. The metal hit $6,230 last week, its lowest since June 2010. The Shanghai Futures Exchange was closed on Friday. The global copper market is expected to record a surplus of about 390,000 tonnes in 2015, according to an industry group, following five straight years of deficit. Chinas factory activity sputtered in December, underlining the challenges facing the countrys manufacturers as they fight rising costs and softening demand in a cooling economy. After a rough 2014, the worlds second-largest economy looks set to start the new year on a weak note, reinforcing expectations that Beijing will roll out more stimulus to avert a sharper slowdown that could trigger job losses and defaults. China consumes some 45 percent of the worlds copper. Still, some analysts believe the copper market may have bottomed out after prices fell more than 14 percent in 2014. I am still expecting global real GDP growth of around 3.5 percent in 2015, Chinese growth just a touch above 7 percent and U.S. growth should improve, said Thomas Lam, chief economist at DMG & Partners Securities in Singapore. If you buy into this global growth story, which translates into demand still pretty moderate and not falling off the cliff, you should see prices gradually getting some support. A top Chinese government think tank said last week it expected economic growth in the country to slow to 7 percent in 2015 from 7.3 percent in 2014. In the short term, there were indications that nearby or physical supply was tight: cash copper for immediate delivery traded at a premium of $68 a tonne over the three-month futures contract on Wednesday, having been at a premium since July.
Posted on: Fri, 02 Jan 2015 03:43:13 +0000
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