July 31, 2018 / 2:05 AM / 3 months ago

METALS-Zinc set for worst month since 2011 as China data disappoints

    BEIJING, July 31 (Reuters) - London Metal Exchange zinc
prices fell for a second session on Tuesday, weighed down by a
stronger dollar making metals more expensive for holders of
other currencies, and after growth in China's manufacturing
sector cooled for a second month.
    Zinc, used to galvanize steel, is down 11 percent so far in
July, which would mark its steepest monthly drop since September
2011, amid fears of oversupply and that a Sino-U.S. trade war
could hurt demand. 
  
    FUNDAMENTALS
    * ZINC: Three-month zinc on the LME fell by 0.7 percent to
$2,539 a tonne as of 0143 GMT, while Shanghai zinc fell by 1.1
percent to 21,055 yuan ($3,091.69) a tonne, on course for its
worst month since December 2016.
    * CHINA: China's official Purchasing Managers' Index (PMI)
released on Tuesday fell to 51.2 in July, from 51.5 in June, but
remained above the 50-point mark that separates growth from
contraction for the 24th straight month.    
    LME COPPER: Three-month LME copper was flat at
$6,250.50 despite the prospect of major strike action in Chile.
The metal is course for a 5.7 percent monthly drop, its steepest
since August 2016.
    * SHFE COPPER: The most-traded September copper contract on
the Shanghai Futures Exchange fell 0.3 percent to
49,801 yuan a tonne, on course for its worst month since March.
    * ESCONDIDA: The union at BHP's Escondida mine in Chile, the
world's largest copper mine, is expected to overwhelmingly
reject the final contract offer from the Anglo-Australian miner,
increasing the likelihood of a strike, a union leader told
Reuters on Monday.
    * CODELCO: Workers at Codelco's            Chuquicamata
copper mine in Chile, the state miner's second largest by
output, walked off the job on Monday morning and blocked access
to the mine, union leaders said, in a move criticized as
"illegal" by Codelco.
    * VEDANTA: Billionaire Anil Agarwal has been given more time
to make a firm offer or walk away from a deal to buy out
minority shareholders in India's Vedanta Resources for
778 million pounds ($1 billion), the London-listed miner said on
Monday.
    * BRAZIL: Brazil's geological service is studying auctioning
off mining rights in 2019 to six previously unexplored areas
that have significant potential output of copper, gold,
phosphate and other minerals, the head of the organization told
Reuters on Monday.
    * For the top stories in metals and other news, click       
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    MARKETS NEWS    
    * Asian share markets weakened on Tuesday, taking cues from
the rout in global technology shares while the yen edged higher
ahead of the Bank of Japan's rate review, at which it could flag
a shift away from its massive monetary stimulus.    
        
    DATA/EVENT AHEAD
    0600  Germany            Retail sales Jun
    0755  Germany             Unemployment rate Jun
    0900  Euro zone           GDP flash Q2
    0900  Euro zone           Unemployment rate Jun
    1230  U.S.         Personal income Jun
    1230  U.S.               Employment costs Q2
    1300  U.S.                S&P/Case-Shiller housing index May
    1345  U.S.               Chicago PMI Jul
    1400  U.S.           Consumer confidence Jul             
U.S. Federal Reserve starts two-day monetary policy meeting    
        
    PRICES
 BASE METALS PRICES                        0146 GMT
 Three month LME copper                        6244
 Most active ShFE copper                      49810
 Three month LME aluminium                   2082.5
 Most active ShFE aluminium                   14570
 Three month LME zinc                          2538
 Most active ShFE zinc                        21065
 Three month LME lead                          2155
 Most active ShFE lead                        18535
 Three month LME nickel                       13865
 Most active ShFE nickel                     112880
 Three month LME tin                          20030
 Most active ShFE tin                        148040
                                                   
 BASE METALS ARBITRAGE                             
 LME/SHFE COPPER              LMESHFCUc3     500.93
 LME/SHFE ALUMINIUM           LMESHFALc3   -1846.07
 LME/SHFE ZINC                LMESHFZNc3     494.31
 LME/SHFE LEAD                LMESHFPBc3     737.88
 LME/SHFE NICKEL              LMESHFNIc3    1898.52
 

($1 = 6.8102 Chinese yuan renminbi)

    
 (Reporting by Tom Daly
Editing by Eric Meijer)
  
 
 
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