Copper hits one-week low

Copper hit a one-week low on Thursday as hopes for swift action to combat Europe's debt crisis were dashed after the European Central Bank underlined its reluctance to pave the way for bond buying on a large scale. In comments after the central bank's move to cut interest rates to 1 percent, ECB President Mario Draghi poured cold water on market expectations the ECB could step up bond purchases seen as key to stabilising rising borrowing costs of indebted members of the eurozone.
Draghi also said lending money to the International Monetary Fund to buy eurozone government bonds was not compatible with EU treaties, though against that he did cut rates and act to extend liquidity provisions for stressed European banks.
"Draghi has not signalled any bond buying, though I think the market was running ahead of itself hoping for that," said Danske Bank analyst Arne Lohmann Rasmussen. Three-month copper on the London Metal Exchange (LME) hit a session low of $7,660, its lowest since November 30 this year. It ended at $7,710 a tonne on the kerb, down from Wednesday's close of $7,820 a tonne.
Copper traded in positive territory earlier this session amid hopes that France and Germany will propose reforms to tighten fiscal discipline in the eurozone at the summit on Friday, dubbed as a last chance to save the euro by the popular press. Also helping the metal, LME copper stocks, seen as an indicator of demand strength, continued their relentless decline, falling 2,050 tonnes to 387,400 tonnes - down nearly 100,000 tonnes from levels seen in March this year.
Europe's debt crisis has been trumping all else as far as copper price direction goes. "Unless we get a major supportive move out of the European meetings, the bleed could well resume," said RBC Capital Markets in a note. On the sidelines, investors are also growing concerned about demand from top consumer China, where concerns are rising about an slowdown in its booming economic growth.
More evidence on China's economy will come from its November export data, due on Friday, which is seen growing at its weakest pace in two years. Zinc ended at $1,988 a tonne from a close of $2,027 a tonne on Wednesday. Data from the LME showed a 20,225 tonne change in zinc stocks in LME-registered warehouses, with an inflow of 21,425 tonnes into warehouses in New Orleans.
Aluminium closed at $2,065 a tonne from $2,078, while battery material lead ended at $2,103 from $2,148. Tin ended at $20,200 a tonne from $20,500 and nickel at $18,300 from $18,050. Indonesia's refined tin exports plunged 75 percent in November from a year ago, following a self-imposed ban by smelters on shipments from the world's top exporter, a trade ministry official said on Thursday.