Zinc up limit in Shanghai - BloombergCopper, Zinc Surge Limit in Shanghai After Holiday on Outlook
By Glenys Sim
May 4 (Bloomberg) -- Copper and zinc futures climbed by theexchange-imposed 6 percent daily limit in Shanghai, trackingmoves in London, on an improved demand outlook.
Copper in London rose on May 1, adding to its longestmonthly winning streak in three years. Inventories monitored bythe exchange dropped for a 15th day, the longest slide sinceFebruary 2008. Stockpiles held in Singapore and South Korea, theclosest locations to China, were the lowest since 2005.
“The decline in LME stockpiles is not necessarily areflection of actual consumption in China, ” Wang Xiaoli, ananalyst at Goldbull Futures Co., said from Shenzhen. “It doesindicate that with a favorable arbitrage in place, Chineseconsumers are still buying because they think demand is there.”
Copper for August delivery on the Shanghai Futures Exchangerose 2,140 yuan from the previous settlement price to 37,860yuan ($5,548) a metric ton.
August-delivery zinc gained as much as 745 yuan to 13,210yuan a ton. Shanghai’s markets were closed May 1 for a holiday.
London copper rose 3.8 percent to $4,600 a ton on Fridayand zinc and gained 6.3 percent $1,515 a ton. The London MetalExchange is closed for a holiday today.
Still, copper may decline this week on speculation that the45 percent rebound this year is counter to expectations forweaker demand. Ten of 16 analysts, investors and traderssurveyed by Bloomberg, or 63 percent, said copper would drop.Six predicted gains fo
China’s Purchasing Manager’s Index climbed for a secondstraight month to 53.5 in April, the Federation of Logistics andPurchasing said May 1. A reading above 50 indicates growth. U.S.manufacturing contracted less than forecast last month andconsumer sentiment improved by the most in more than two years.China and the U.S. are the world’s two largest users of copper.
To contact the reporter on this story:Glenys Sim in Singapore atGsim4@bloomberg.net
Last Updated: May 3, 2009 23:18 EDT