July 2, 2018 / 8:03 AM / 17 days ago

METALS-London copper strikes 3-month low as trade tensions simmer

(Adds details and updates prices)

By Melanie Burton

MELBOURNE, July 2 (Reuters) - London copper slid to its lowest since late March on Monday after China’s manufacturing growth tempered in June, reflecting a slowdown in the real economy and simmering trade tensions with the United States.

Growth in China’s manufacturing sector slowed in June after a better-than-expected performance in May, official data showed at the weekend, while a private survey on Monday showed that China’s factory growth cooled slightly.

It was a trend seen across the region as Asian exporters lost momentum even before tariffs on U.S. and Chinese goods kick in this week, in a worrying sign the Trump administration’s “America First” protectionist policies could derail global growth.

“Data over the weekend is likely to see investors question whether there are more clouds ahead for the sector,” wrote ANZ in a report.

“This is likely to raise concerns that China’s GDP growth will weaken further in H2 2018.”

* COPPER: London Metal Exchange copper slipped to $6,579 a tonne, as of 0745 GMT, down 0.7 percent since Friday, and plumbing the weakest since March 26. Prices fell 3.3 percent in June, the biggest monthly loss since September. Shanghai Futures Exchange copper inched down by 0.4 percent to 51,210 yuan ($7,698) a tonne.

* LME METALS: LME zinc and aluminium were the worst performers last month. LME zinc gave up 8 percent as supply recovers after a year of deficit drove prices to decade highs and encouraged restarts while aluminium fell 7 percent as in China output continues to increase. LME zinc fell by 0.6 percent to $2835 while LME aluminium slid 0.6 percent to $2120.

* COPPER INVESTORS: Hedge funds and money managers cut their net long position in copper by 29,240 contracts to 22,061 contracts, CFTC data showed. This was the weakest position since early May in the week to June 26, U.S. Commodity Futures Trading Commission (CFTC) data showed on Friday.

* INDONESIA COPPER: Indonesia’s state-owned mining holding company PT Inalum is close to finalising a multi-billion-dollar deal to acquire a majority stake in the giant Grasberg copper mine, government officials said on Saturday.

* MINING CONSOLIDATION: Vedanta Resources Plc said on Monday chairman Anil Agarwal’s family trust has agreed to buy the rest of Vedanta in a deal that values the mining conglomerate at 2.3 billion pounds ($3.03 billion).

COMING UP: Germany Markit/BME mnfg PMI Jun at 0755 GMT

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 = 6.6521 Chinese yuan)

Reporting by Melanie Burton; Editing by Sunil Nair and Sherry Jacob-Phillips

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