May 21, 2020 / 7:26 AM / 12 days ago

METALS-London copper falls from 2-month high as economic worries linger

(Recasts, updates prices)

By Mai Nguyen

SINGAPORE, May 21 (Reuters) - London copper fell on Thursday, as concerns over the long-term impact of the coronavirus pandemic offset some enthusiasm about economies gradually reopening.

Three-month copper on the London Metal Exchange (LME) fell 0.3% to $5,428.50 a tonne by 0703 GMT. Earlier in the session, the contract hit $5,464 a tonne, its highest since March 13.

A stronger U.S. dollar also added pressure to LME prices, making the metals on the exchange costlier for buyers using other currencies.

The most-traded July copper contract on the Shanghai Futures Exchange (ShFE) closed up 1% at 44,150 yuan ($6,217.35) a tonne.

“Copper and S&P charts are pretty much the same,” said a base metals trader, expecting the correlation trend would continue as long as central banks keep injecting liquidity into the markets.

Asian shares and Wall Street futures on Thursday stepped back as worries about long-term economic growth returned, while investors hoped for more economic stimulus from a key policy meeting in China on Friday.

FUNDAMENTALS

* CHINA COPPER: Global copper smelting recovered in April due to renewed activity in China and has been even stronger so far in May.

* PHILIPPINE NICKEL: Philippines’ nickel ore output in January-March shrank 27% from a year earlier to 28,006 tonnes, as over half of mines there halted production.

* OTHER PRICES: LME nickel rose 0.7% to $12,750 a tonne and tin advanced 1.1% to $15,630 a tonne. In Shanghai, ShFE aluminium retreated from a near 11-week high to close down 0.7% at 12,775 yuan a tonne while nickel jumped 2.5% to 105,110 yuan a tonne.

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$1 = 7.1011 yuan Reporting by Mai Nguyen; editing by Uttaresh.V and Ramakrishnan M.

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