METALS-Copper settles lower as economic doubts remain

Copper stocks drop, aluminum stocks near record high* Eyes on China trade data later in the week* Tin in backwardation (Changes headline, recasts, updates with New York closing copper prices, adds NEW YORK to dateline and analyst comments)By Chris Kelly and Michael TaylorNEW YORK/LONDON, July 7 - Copper prices closed lower on Tuesday as concerns over an uncertain economic outlook and its impact on demand dragged values down, outweighing the fleeting positive impact of upbeat German manufacturing data earlier in the day.Copper for September delivery on the New York Mercantile Exchange's COMEX division fell 3.70 cents to settle at $2.2255 a lb."It's a bit of hesitation we're seeing today," said Robin Bhar, senior metals analyst at Calyon. "Prices seem to have stalled in both equity and commodity markets... as this recovery hasn't come through perhaps as quickly as everyone has wanted."There are some doubts as to whether growth is beginning to peter out," he added.On the London Metal Exchange copper for three-months delivery was last bid on the floor at $4,880 a tonne, versus Monday's close of $4,970. The metal used in power and construction hit a session peak at $5,045.Boosting economic sentiment earlier in the session was data showing German manufacturing orders rose at their strongest pace in nearly two years. But that sentiment turned as global equity markets weakened amid rising prospects of a protracted economic recovery.

"It still looks like the market is having trouble reconciling how strong things will be," said Steve Platt, futures analyst with Archer Financial Services in Chicago. "We are still vulnerable to rising joblessness... not a conducive factor for the copper market to be going up."Soaring U.S. unemployment and a shrinking economy drove delinquencies on credit-card debt and home equity loans to all-time highs in the first quarter, the American Bankers Association said. [ID:nN07299679]Analysts also warned that copper faced pressure as a traditionally quiet trading period begins and as Chinese demand subsides."We're going into the quieter summer period and there's a widespread belief that Chinese imports are going to be lower in these couple of months for most of the metals," said Stephen Briggs, commodity strategist at RBS Global Banking and Markets.Stockpiling by China, the world's top copper consumer, has helped copper prices surge about 60 percent so far in 2009. But analysts warn this support is fading and Western economies remain too beleaguered to pick up the baton just yet.CHINA DATA EYEDChina's imports of unwrought copper and semi-finished copper products are expected to fall from May's record, squeezed by increased prices on the LME, trimming margins for spot inflows. The data is due to be released around July 10. [ID:nHKG28061]"With rising inventories and weaker domestic price premiums, if the Chinese June data supports the view that domestic demand is beginning to ebb, then downward trend could be more sustained," Barclays Capital said in a note.Data showed copper inventories fell 3,250 tonnes to 265,925 tonnes.But the market tone remained nervy.

The European Union warned economic growth may be permanently damaged by the financial crisis and a U.S. adviser said Washington must plan a second stimulus round. [ID:nL743499]Among other metals, aluminum ended at $1,618 a tonne versus $1,617. Stocks of the metal used in transport industries and packaging rose 250 tonnes to flirt with a record near 4.4 million tonnes.Zinc closed at $1,565 a tonne from $1,565, while battery material lead finished at $1,656 from $1,684.The parent of Jiangxi Copper is building a 200,000-tonne-per-year lead smelter and a 200,000-tonne-per-year zinc smelter, which would add further to China's surplus of lead and zinc. [ID:nHKG15545]Nickel traded at $15,650 from $15,950. Tin was last bid on the floor at $14,125 from $14,250. Tin is in a backwardation -- premium for cash material over the three-months contract -- of $85.Investors are showing increasing concern about the scale of long positions developing in the tin market, compared with the amount of available metal stored in LME warehouses.

More information can be viewed:incoloy 800h

Detect-Metals is a company that has proven experience, certified quality and dependable service providing specialty metals leadership and supply chain innovation. It is through those strengths that we have expanded our abilities