US copper futures edged lower at the open on Thursday, extending a four-day decline, with macro-economic jitters prompting further aversion to some "riskier" commodity markets, analysts said.
"I think the copper is being buffeted mostly by the sell-off in the stock market, especially in Europe and here in the US," said Frank McGhee, head precious metals trader with Integrated Brokerage Services LLC in Chicago.
"A lot of it depends on what goes on with the US stock market. We have got an easing of rates, but that is a market-driven event, and the question is once this stock sell-off stabilises, will those rates run right back up or is it longer-term parking of funds?" McGhee said.
Copper for September delivery was off 0.55 cent to $3.55 a lb by 10:54 am EDT (1454 GMT) on the New York Mercantile Exchange's COMEX division, moving between $3.52 and $3.5805. McGhee saw some commercial buying moving in at the $3.50 level, providing some stability from the recent sell-off from 11-week highs above $3.70 reached last Friday. "Between $3.50 down to $3.40, you should see some strong commercial trade come in," he said.
Futures volumes were estimated at 6,403 lots by 10 am at 11 am EDT, the Dow Jones Industrial Average of 30 blue chip issues tumbled as a surge in oil prices, concern about the housing slump and a worsening climate for financing take-overs cut investors' appetite for risk in a global equities sell-off.
Copper, a main component used in construction, failed to garner support from new US home sales data that continued to show weakness in the down beaten sector. Sales of new US homes fell 6.6 percent in June to a lower-than-expected level and prices slumped from May, according to a government report on Thursday.
Longer-term, analysts looked for growth in emerging markets to off-set the weakness in the US Supply-side fundamentals showed London Metal Exchange-monitored warehouse stocks climb 1,800 tonnes to 100,825 on Thursday. COMEX stocks fell 92 short tons to 22,728 on Wednesday.
Meanwhile, Chilean copper giant Codelco remained in talks on Wednesday with subcontracted workers who have been on strike for a month, with its small Salvador division still out of action.