London copper reversed early losses on Thursday, following a 3 percent rally in the previous session but Shanghai lagged the international market prompting the profitable arbitrage to snap shut. The premium for Shanghai's third month copper contract to three-month LME futures slipped into a 240 yuan discount, after accounting for China's 17 percent value added tax, having averaged around 400 yuan in the past six weeks and down from a peak above 1,500 yuan in early June.
Benchmark third-month Shanghai copper closed up 1.1 percent at 53,930 yuan closing just off the day's peak of 53,980 yuan, its highest since June 28.
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