Copper fell on Friday after a pay settlement at Chile's giant Escondida mine, but analysts expect future pay negotiations, possible strikes and receding worries about higher US interest rates to support prices.
News that union workers would accept a new offer triggered a brief sell-off in copper earlier this week, but the metal bounced more than 3 percent on Thursday.
London Metal Exchange copper for three months delivery ended down at $7,590 per tonne compared with $7,690 on Thursday as players closed their books ahead of a long holiday weekend in the United States.
Jobs growth data from the United States caused few ripples as the figure for August, a moderate 128,000, was in line with expectations and suggested the US Federal Reserve's rate tightening cycle may be coming to an end.
"There wasn't much to it (the data) in the end," a London Metals Exchange (LME) trader said.
"You had all these people with long positions who worked out they're not the only car on the block ... They want to be square before they go home because of the US holiday."
US markets are closed for Labour Day on Monday.
The vote at Escondida, the world's largest copper mine, ended a four-week strike and analysts are now looking to potential future production disruptions, with wage negotiations to come at mines accounting for 12 percent of global output.
"The market had already factored in the settlement," analyst David Thurtell at BNP Paribas said. "The settlement ... will form the benchmark at the other operations in South America."
Copper prices have been volatile this week partly because of low summer volumes and partly because of uncertainty about whether Escondida workers would agree to a settlement, but overall on the week they are little changed.
"(However) a pick-up in industrial activity and demand as we come out of the summer lull will support prices against a background of still tight supplies and some labour negotiations," said UBS analyst Robin Bhar.
"Economics are neutral and will perhaps not dominate sentiment until we move into 2007."
Copper stocks at LME-registered warehouses rose 50 tonnes to 125,400, but that is less than three days of global consumption.
Elsewhere in metals markets aluminium ceded $15 to $2,490, while zinc added $10 to $3,440.
Zinc was supported by a fall in inventories, down 1,000 tonnes to 172,500, their lowest since February 1992.
Nickel fell to $28,700 against $29,000 on Thursday, when the metal jumped 5.8 percent at the close.
Nickel stocks in LME-registered warehouses came in at 5,358 tonnes, up by 186 but still with only 3,114 tonnes available to the market, less than one day of global consumption.
But reflecting a less critical situation in stocks, the backwardation - the premium for cash settlement versus three-month delivery - eased to $3,400 from $5,250 last week.
Lead gained $15 to $1,225 and tin saw no business at the close, but was indicated at $8,950/9,000.
Comments
Comments are closed.