October 26, 2018 / 5:32 AM / 22 days ago

METALS-London copper retreats, heads for 2nd straight weekly drop

 (Adds comment, updates prices)
    BEIJING, Oct 26 (Reuters) - London copper prices retreated
by more than 1 percent on Friday, wiping out Thursday's gains
from a sharp drop in inventories, as concerns over the impact of
a U.S.-China trade row on demand for industrial metals returned
to focus.
    The metal had risen 0.8 percent in the previous session
after on-warrant LME inventories - those not earmarked for
delivery - slid to their lowest since December 2005.

    "Cancelled warrants and orders to remove inventories from
LME warehouse have climbed 20 percent in the past two days," ANZ
said in a note on Friday.
    Despite falling stocks, London copper is down 1 percent for
the week, after shedding 1.3 percent in the week ended Oct. 19,
while open interest in Shanghai copper has fallen to its lowest
since February 2017.
    "Demand is not very good, stocks are rising and the market
does not have confidence at this time," despite a pledge of
support from the Chinese government, a broker said.
    
    FUNDAMENTALS
    * LME COPPER: Three-month copper on the London Metal
Exchange fell 1.2 percent to $6,154 a tonne by 0451 GMT.
    * SHFE COPPER: The most-traded December copper contract on
the Shanghai Futures Exchange rose as much as 1.3
percent before trimming gains to 0.4 percent by the end of the
morning, when it stood at 49,950 yuan ($7,176.52) a tonne. 
    * OPEN INTEREST: Market open interest on Shanghai copper
fell to 495.476 lots on Thursday, the lowest since Feb. 9, 2017,
in a sign that money is leaving the market. 
    * OTHER METALS: The rest of the base metals complex was
lower, with ShFE nickel slipping 1 percent. Shanghai
lead was the only other metal to buck the trend,
gaining 1 percent on falling stocks.
    * VALE: Brazil's Vale, the world's top iron ore
producer, is expecting major improvement in the performance of
its base metals division in 2020 but said that production cuts
would remain in effect this year and next while prices remain
low, executives said on Thursday.
     * For the top stories in metals and other news, click     
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    MARKETS NEWS    
    *  Asian shares slipped again on Friday morning, deepening
this week's markets rout, after disappointing results from
Alphabet Inc and Amazon.com heightened concerns over the outlook
for U.S. corporate earnings, global trade and economic growth.
    
        
    DATA/EVENT AHEAD (GMT)
    0600  Germany    GfK consumer sentiment Nov
    0645  France    Consumer confidence Oct
    0645  France    Producer prices Sep
    1230  U.S.      Advance GDP Q3
    1400  European Central Bank President Mario Draghi speaks   
            
    PRICES
                                          0511 GMT
 Three month LME copper                     6155.5
 Most active ShFE copper                     49950
 Three month LME aluminium                    1990
 Most active ShFE aluminium                  14170
 Three month LME zinc                       2627.5
 Most active ShFE zinc                       22100
 Three month LME lead                       1997.5
 Most active ShFE lead                       18455
 Three month LME nickel                      12090
 Most active ShFE nickel                    100740
 Three month LME tin                         19260
 Most active ShFE tin                       147560
                                                  
                                                  
 LME/SHFE COPPER             LMESHFCUc3     207.29
 LME/SHFE ALUMINIUM          LMESHFALc3   -1919.57
 LME/SHFE ZINC               LMESHFZNc3     253.26
 LME/SHFE LEAD               LMESHFPBc3    1503.16
 LME/SHFE NICKEL             LMESHFNIc3    2355.07
 

($1 = 6.9602 Chinese yuan)

    
 (Reporting by Tom Daly; Editing by Subhranshu Sahu, Amrutha
Gayathri)
  
 
 
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