By Glenys Sim
Feb. 10 (Bloomberg) -- Copper fell in Shanghai as investors awaited further details on a U.S. economic stimulus plan and amid speculation a two-day surge in the futures was excessive.
Copper in London also declined before an announcement of the U.S. financial-rescue program later today. Treasury Secretary Timothy Geithner is seeking to add private funding as a component of proposals to address the toxic debt clogging banks’ balance sheets. Shanghai futures rose by the trading limit in the past two days.
“It was getting a bit excessive because we haven’t seen an improvement in fundamentals yet,” Pan Jinghua, an analyst at Jinpeng International Futures Co., said from Beijing today. “In one camp we have people who are optimistic about these economic stimulus plans, and in the other camp we have people who think it’s not enough.”
Copper for April delivery on the Shanghai Futures Exchange fell 1 percent to 29,230 yuan ($4,277) a metric ton at 10:30 a.m. local time. London Metal Exchange copper fell 0.3 percent to $3,569.50 a ton after earlier rising 1.2 percent.
China’s inflation cooled to the weakest pace in more than two years and producer prices fell as growth slumped in the world’s third-largest economy, pressuring copper prices lower.
Consumer prices rose 1 percent in January from a year earlier, the statistics bureau said today, after gaining 1.2 percent in December.
Copper prices have been supported by rumors that China’s Strategic Reserve Bureau is rebuilding inventories, Michael Widmer, senior metals market analyst with BNP Paribas, said in a report e-mailed today. “Any re-stocking comes with various caveats, although it is certainly not bearish,” he said.
Among other LME-traded metals, zinc fell 0.8 percent to $1,185 a ton, and lead lost 1.6 percent to $1,180 a ton. Aluminum declined 0.6 percent to $1,437 a ton, while nickel and tin hadn’t traded as of 10:30 a.m. in Singapore.
To contact the reporter for this story: Glenys Sim in Singapore at gsim4@bloomberg.net
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