Copper Near 2 - Week Peak on Hopes for China Support

Bareksa.com - London copper traded near its highest in two weeks on Wednesday, finding support from a pledge by Chinese authorities to support growth and a lack of immediate supply.

The market is looking past weakness in China's vast property sector to focus on easier liquidity conditions in the world's top user of the metal, said analyst Chunlan Li of CRU in Beijing.

"The macro situation is improving, which is supporting copper prices. In June, demand has not been that bad. Copper tube for air conditioners is sliding month on month but wire and cable is okay and Shanghai physical premiums remain high," she said.

Three-month copper on the London Metal Exchange was flat at $6,708 a tonne by 0716 GMT, after closing little changed in the previous session. It earlier hit $6,733 a tonne, its loftiest since June 6.

The most-traded August copper contract on the Shanghai Futures Exchange also finished flat at 48,130 yuan ($7,800) a tonne.

Average new home prices in China's 70 major cities rose 5.6 percent in May from a year earlier, easing from the previous month's 6.7 percent rise, according to Reuters calculations from official data published on Wednesday. It was the slowest annual rise in 13 months.

The property market has lost momentum since late 2013 after an extended campaign by authorities to rein in rapid price growth, including tighter controls on speculative buying and tougher lending conditions.

Still, the country is confident it will hit its growth target of 7.5 percent this year, Chinese Premier Li Keqiang said on Monday, adding that the government was ready to adjust policy to make sure it does.

The U.S. Federal Reserve is widely expected to chop another $10 billion from its monthly bond purchases at a meeting on Tuesday and Wednesday but make few, if any, other concrete policy moves.

China's CITIC Resources Holding Ltd said on Wednesday a court has been unable to secure more than 100,000 tonnes of alumina stored at Qingdao port, deepening fears that firms exposed to a metals financing scam at the port could face big losses.

Nickel has been bought up on renewed concerns over disruptions in Russian supply, given what appears to be a harder line being taken by Moscow over gas supplies to the Ukraine, and the potential for a tougher response from the U.S. over sanctions, said broker Triland in a note.

"However, we won't get too carried away as nickel still looks to be in a side-ways consolidation phase," it said.

LME nickel prices have recovered by almost 8 percent from two-month lows hit on June 12. (Source : Reuters)