Shanghai copper rebounded on Friday ahead of a week-long Labour Day break, but the market remained on edge over expectations of further moves to cool over-investment, traders said.
The Shanghai Futures Exchange will be closed from May 1 to May 9 and will resume trade on Monday, May 10. Shanghai copper strengthened throughout the day, with the most active October contract ending 530 yuan higher at 24,130 yuan ($2,915) a tonne.
Other contracts gained between 380 yuan and 550 yuan a tonne. Combined volume decreased to 215,966 lots from 233,094 lots on Thursday. "Investors are feeling cautious prior to the holiday here," said a Shanghai trader.
"It's very difficult to say where things are going to go from here. It all depends what further measures the government takes to restrain the economy, though you can be certain that the market will remain nervous for the time being," he added.
The London and Shanghai markets tend to affect each other. China has been the chief cause of huge falls in Shanghai and London metal markets recently, as increasingly stringent measures are being implemented by Beijing to stop the economy from overheating, traders said.
Premier Wen Jiabao told Reuters this week that the government would adopt forceful measures to cool a dangerously fast-growing economy.
LME copper eased to $2,625/$2,635 a tonne on Friday's Asian trade, after gaining $52 to end London's kerb at $2,632.
The contract had fallen to $2,570 it's lowest since February 11 on concerns over China's curbs on excessive lending.
Spot copper in Shanghai rose by 390 yuan and 490 yuan to move in a range between 24,900 yuan and 25,000 yuan per tonne, in line with the day's gains in futures. Shanghai aluminium closed up on the day, with most contracts gaining between 10 and 120 yuan. Volume shrank to 125,262 lots from Thursday's 225,046 lots. LME aluminium was trading at $1,664/$1,669 on Friday's Asian trade, versus on Thursday's London kerb close of $1,663.
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