AGL 41.50 Increased By ▲ 2.96 (7.68%)
AIRLINK 128.00 Decreased By ▼ -1.50 (-1.16%)
BOP 6.26 Increased By ▲ 0.65 (11.59%)
CNERGY 4.13 Increased By ▲ 0.27 (6.99%)
DCL 8.44 Decreased By ▼ -0.29 (-3.32%)
DFML 40.69 Decreased By ▼ -1.07 (-2.56%)
DGKC 87.90 Decreased By ▼ -0.40 (-0.45%)
FCCL 34.10 Decreased By ▼ -0.90 (-2.57%)
FFBL 66.33 Decreased By ▼ -1.02 (-1.51%)
FFL 10.56 Decreased By ▼ -0.05 (-0.47%)
HUBC 108.70 Decreased By ▼ -0.06 (-0.06%)
HUMNL 14.46 Decreased By ▼ -0.20 (-1.36%)
KEL 4.65 Decreased By ▼ -0.10 (-2.11%)
KOSM 7.33 Increased By ▲ 0.38 (5.47%)
MLCF 42.72 Increased By ▲ 1.07 (2.57%)
NBP 60.84 Increased By ▲ 1.24 (2.08%)
OGDC 178.97 Decreased By ▼ -4.03 (-2.2%)
PAEL 25.70 Decreased By ▼ -0.55 (-2.1%)
PIBTL 6.06 Increased By ▲ 0.09 (1.51%)
PPL 146.15 Decreased By ▼ -0.55 (-0.37%)
PRL 24.91 Increased By ▲ 1.30 (5.51%)
PTC 16.14 Decreased By ▼ -0.42 (-2.54%)
SEARL 70.20 Increased By ▲ 1.90 (2.78%)
TELE 7.22 Decreased By ▼ -0.01 (-0.14%)
TOMCL 36.20 Increased By ▲ 0.25 (0.7%)
TPLP 7.84 Decreased By ▼ -0.01 (-0.13%)
TREET 15.59 Increased By ▲ 1.39 (9.79%)
TRG 50.36 Decreased By ▼ -0.09 (-0.18%)
UNITY 26.90 Increased By ▲ 0.15 (0.56%)
WTL 1.24 Increased By ▲ 0.03 (2.48%)
BR100 9,795 Decreased By -11.1 (-0.11%)
BR30 29,647 Decreased By -31.2 (-0.1%)
KSE100 92,021 Decreased By -282.9 (-0.31%)
KSE30 28,665 Decreased By -175.5 (-0.61%)

Copper reversed earlier gains and drifted lower on Friday as gloomy macroeconomic data from the United States reinforced fears of a recession and further weakened the demand outlook for metals. Copper for three-month delivery on the London Metal Exchange fell to $3,755 per tonne, after rising as high as $3,952 per tonne and compared to its close at $3,805 a tonne on Thursday.
US employers slashed an unexpectedly steep 240,000 jobs from payrolls last month and the jobless rate shot up to a 14-1/2-year high, the government said in a report underscoring the economy's slide. "Everything's just ugly at the moment," analyst Marc Elliott at Fairfax said. "For the time being it is going to be very volatile," he said, adding he did not expect the market conditions to change much between now and year-end.
Copper, used in power and construction, has lost more than half of its value since a record high of $8,940 a tonne on July 2. Last week it hit a three-year low of $3,590 a tonne. Reinforcing fears that the worst is yet to come were gross domestic product forecasts from the International Monetary Fund, which expects global growth to slow to 2.2 percent next year from 3.7 percent this year.
"News in the last few days has been so terrible that I think you've got to be pretty optimistic to start thinking we're over the worst," said Dan Smith, analyst at Standard Chartered. Lack of demand could be mirrored in rising copper inventories. Stocks of the metal in LME warehouses at above 250,000 tonnes are the highest since early March 2004.
Copper had rallied nearly 4 percent earlier on Friday, mainly driven by short-covering - investors who had bet on lower prices buying back their positions. "Base metals have been targeted for short selling recently leading to violent short-covering rallies but the resultant higher prices are unlikely to be sustained for long so we favour selling into these for most metals," Barclays said in a note.
"Low prices will store up problems for future supply, particularly if they remain at recent lows for a prolonged period." That is true for aluminium, hit by slumping car sales and expectations of a large surplus this year.
Analysts say aluminium prices at $2,050 are below the costs paid by the highest cost producers, many of which are delaying expansion plans or idling capacity. The latest news on output was from Aluminium Corp of China on alumina - feedstock for aluminium. The company, also known as Chalco, said on Thursday it had shut down 38 percent of its annual alumina capacity.
"The production response to lower prices has already started, but with the market's focus firmly on demand, and how bad it could get production cuts are unlikely to provide much support to prices," Barclays said.
Aluminium closed at $1,960 a tonne from $2,039 a tonne on Thursday, a loss of nearly 40 percent since an all-time high of $3,380 on July 10. Steel making raw material nickel was last quoted at $10,975/11,000 from $11,405 on Thursday. Zinc ended at $1,091/1,092 from $1,100, tin at $14,600/14,700 from Thursday's last bid at $14,575 and lead at $1,361 from $1,459.

Copyright Reuters, 2008

Comments

Comments are closed.