Copper futures fell 1.3 percent in Shanghai on Friday, tracking overnight losses in London, as investors fretted over rising international stockpiles and on signs that tight supply in China might be starting to ease. Market attention has turned to Shanghai Future Exchange copper inventories, which fell 10 percent this week in data released after the market closed, but traders said inventories could rise next week.
Shanghai stocks fell by a greater-than-expected 4,171 tonnes to 17,625 tonnes in the week ended on Thursday, their lowest in three years and enough for less than two days of Chinese consumption.
The discount for third-month Shanghai copper futures versus the benchmark London contract, including China's 17 percent VAT, narrowed to 1,761 yuan, from 1,862 yuan a tonne on Thursday. The discount shrank to 716 yuan on August 13, its narrowest since March. Shanghai aluminium dipped 150 yuan to 17,730 yuan, while London metal rose $6 to $2,736.
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