Copper Climbs, Ending Biggest Selloff in Nine Months, on China

By Claudia Carpenter

Aug. 13 (Bloomberg) -- Copper climbed in London, ending the biggest selloff in nine months, on speculation Chinese growth will spur demand for the metal used in pipes and wires.

Copper for delivery in three months rose $105, or 1.5 percent, to $7,255 a metric ton as of 12:24 p.m. on the London Metal Exchange. Prices dropped 6.7 percent the previous three sessions, the most since the three days ended Nov. 21.

Commodities demand from China, the largest metals buyer, will rally in the next quarter, Goldman Sachs JBWere Pty said. Buyers in China bought copper in the past four or five months when it dipped below $7,800 a ton, said Max Layton, an analyst at Macquarie Bank Ltd. in London.

``We would expect consumer interest from China at these levels,'' Layton said.

The price of copper on the Shanghai Futures Exchange has fallen less than the LME price in the past month, possibly leading to more imports by China, according to Macquarie.

The metal's 14-day relative strength index held below 30 this week, a chart signal that prices may gain.

``There's a bit of a technical rebound,'' said Michael Widmer, an analyst in London at Lehman Brothers Holdings Ltd. ``What we need is that China continues to expand at a healthy rate.''

Nickel, the only metal on the LME that rose yesterday, dropped $19 to $18,081 a ton and lead fell another $55, or 3.2 percent, to $1,685 a ton on top of yesterday's 9.6 percent decline. Zinc advanced $28.20 to $1,643.20 a ton, aluminum added $3.50 to $2,775.50 a ton and tin climbed $50 to $17,550 a ton

To contact the reporter on this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net or ccarpenter2@bloomberg.net