Copper drops as inventories rise

Print this page Posted on : 08-29-2007 by recycleinme.com

Industrial metals prices slipped on Tuesday on news of an 8 per cent rise in unused copper inventories and against a backdrop of concern about the health of the global economy, analysts said.

Copper for delivery in three months at the London Metal Exchange, often seen as a gauge of the real economy, was 1.2 down per cent at $7,220/7,240 per tonne.

It had been trading steadily until the LME released data showing stocks of unused metal held in warehouses leapt by more than 109,000 tonnes on Tuesday to 135,625 their highest since May.

“Everyone was waiting for the stocks data, and it was a big rise”. UBS analyst Mr. Robin Bhar said. :It knocked the stuffing out of the price. It points to softer demand for copper”. Copper, along with other commodities, was hit hard when investors sold holdings for cash to cover losses elsewhere as stock markets fell in the wake of the collapse in the US sub-prime mortgage market earlier this month. Aluminium was down $8 at $2,547 / 2,552 and zinc was down $69 at $3,070 / 3,090. Lend was down $45 at $3,195 / 3,215 while tin wad down $50 at $14,500/14,600.

Source : Business Line