March 17, 2020 / 5:21 AM / 20 days ago

METALS-London copper recovers slightly after hitting 40-month trough

(Updates prices)

By Mai Nguyen

SINGAPORE, March 17 (Reuters) - London copper prices edged up on Tuesday from a 40-month low hit in the previous session, as investors expected that the U.S. Federal Reserve’s policy measures could boost long-term demand for metals.

Three-month copper on the London Metal Exchange (LME) was up 0.3% at $5,306.50 a tonne by 0412 GMT, having fallen to its lowest since November 2016 on Monday.

“(The) Fed’s latest cut in interest is a very strong liquidity injection. Generally a low interest environment in longer run brings base metal business cycle back,” said a Singapore-based metals trader, referring to the U.S. Federal Reserve.

The U.S. central bank cut interest rates to near zero on Sunday and pledged to expand its balance sheet by at least $700 billion in the coming weeks, but that did little to calm investor panic over the deepening economic hit from the virus.

“After one day of panic selling, some market participants start to expect a rebound, especially Asian traders who have witnessed the effective control in countries like China, Singapore and South Korea,” the trader added.

LME nickel advanced 2.2% to $12,195 a tonne, zinc rose 0.7% to $1,955 a tonne, lead was little changed at $1,727 a tonne, while tin increased 0.5% to $15,375 a tonne.

FUNDAMENTALS

* STIMULUS: Australia, Canada and New Zealand recently announced new measures to help arrest the economic impacts of the fast-spreading coronavirus.

* HYUNDAI: Hyundai Motor’s China domestic plant sales in February dropped 97% from a year ago.

* OYU TOLGOI: Work at Rio Tinto Ltd’s Oyu Tolgoi copper-gold mine in Mongolia has slowed because of government measures against the coronavirus.

* SHFE PRICES: The most traded nickel contract on the Shanghai Futures Exchange (ShFE) fell 0.4% to 99,230 yuan ($14,187.27) a tonne, zinc eased 0.4% to 15,650 yuan a tonne, while tin declined 2% to 125,240 yuan a tonne.

* For the top stories in metals and other news, click or

PRICES

Three month LME copper

Most active ShFE copper

Three month LME aluminium

Most active ShFE aluminium

Three month LME zinc

Most active ShFE zinc

Three month LME lead

Most active ShFE lead

Three month LME nickel

Most active ShFE nickel

Three month LME tin

Most active ShFE tin

ARBS ($1 = 6.9943 Chinese yuan renminbi) (Reporting by Mai Nguyen; Editing by Aditya Soni)

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