Copper Little Changed on Demand Signals; Zinc, Aluminum Higher

Copper prices were little changed in Asia after the U.S. Federal Reserve signaled that the world's largest economy is likely to keep growing, boosting prospects for demand in the second-biggest consumer of the metal. Losses in credit markets won't hamper the economy's "moderate" expansion, the Federal Open Market Committee said yesterday after meeting in Washington and keeping its benchmark interest rate unchanged at 5.25 percent. Demand for copper, used in wires and pipes, tends to rise with economic growth. "Shanghai and London markets are lying low after a period of volatility, waiting for the next trigger, which could be Chinese imports, stockpiles, or equities," He Ruiyan, head of research at Xiamen International Trade Futures Co., said today. Copper for October delivery on the Shanghai Futures Exchange gained as much as 610 yuan, or 0.9 percent, to 66,890 yuan ($8,835) a metric ton. The contract was little changed at 66,140 yuan a ton at the end of morning trading at 11:30 a.m. local time. Metal for immediate delivery in Changjiang, Shanghai's biggest cash market, fell as much as 0.7 percent to 65,320 yuan a ton today. London Metal Exchange copper for delivery in three months was unchanged at $7,745 a ton at the same time. "Good physical buying levels and falling stockpiles are keeping LME copper over $7,700 and SHFE copper over 65,000 yuan," He said. Global stockpiles of the metal monitored by the LME, which have fallen 42 percent this year, rose 0.1 percent to 105,600 tons yesterday, the exchange said. World equity markets rallied after yesterday's Federal Reserve meeting, a sign of easing concern that U.S. home loan losses may spread and slow economic growth. The Morgan Stanley Capital International Asia-Pacific Index rose 0.8 percent to 151.83 at 11:03 a.m. in Shanghai. Labor Disputes A Mexican arbitration court ruled that strikes halting production at three Grupo Mexico SAB mines since last week are illegal, according to a statement posted on the Ministry of Labor's Web site yesterday. Still, striking workers won't return to work immediately as an appeal will be lodged, a lawyer representing the mine workers' union said. Workers in Chile, the world's largest copper producer, may hold more protests that could disrupt output, according to the two lawmakers in charge of congressional mining committees. Contract workers at Codelco, the world's biggest copper producer, ended a strike July 31 that cut output for more than five weeks. Zinc in Shanghai for October delivery rose 0.7 percent to 27,835 yuan a ton at the 11:30 a.m. local time break, while October delivery aluminum was up 0.3 percent at 19,530 yuan a ton. Zinc for delivery in three months on the London Metal Exchange rose 1.5 percent to $3,430 a ton at the same time, while aluminum was up 0.2 percent at $2,670 a ton. Among other LME-traded metals, lead rose 0.6 percent to $3,170 a ton. Nickel and tin were untraded in Asia after ending yesterday at $28,900 and $16,750 a ton, respectively.