London copper steadies, underpinned by weaker dollar; nickel weakens

MELBOURNE — London copper was steady on Monday, supported as the dollar eased following a disappointing US jobs report, while zinc and nickel prices tracked renewed weakness in steel markets.

“We think copper should hold its own in June, as the Grasberg strike provides support… ( and) falling stock levels on both the LME (London Metal Exchange) and Shanghai should also help,” INTL FCStone said in a report.

Freeport McMoRan, Inc. said last month that mining and milling rates at its Grasberg copper mine in Indonesia had been affected by an extended strike.

“Concern about moderating demand trends in China including a slowdown in real estate price growth have unnerved the market,” INTL FCStone added. It sees copper trading between $5,520 and $5,825 this month.

London copper was trading flat at $5,665 a ton by 0607 GMT, following a 0.60% loss on Friday. Prices have been trapped in a $5,460$5,770 range since early May.

Shanghai Futures Exchange (ShFE) copper slipped 0.20% to 45,290 yuan ($6,657) a ton. LME zinc traded almost three times the volume of LME copper, with traders looking for opportunities in the price gap between London and Shanghai. Chinese prices for the metal, used to galvanize steel, slipped by 1.10%, tracking a 2.90% fall in ShFE rebar.

The World Bank on Sunday maintained its forecast that global growth will improve to 2.70% this year, citing a pickup in manufacturing and trade, improved market confidence and a recovery in commodity prices.

Activity in China’s service sector expanded at the fastest pace in four months in May thanks to a surge in new orders, a private business survey showed, helping to offset worries about unexpected weakness in manufacturing.

China agreed to delay an 8% quota for electric and hybrid vehicles by a year until 2019, an auto industry source said on Friday, in a major concession for German car makers seeking to expand in the world’s largest auto market.

Electric cars are a major growing demand segment for copper.