Europe, China concerns send copper prices lower

Copper prices fell Friday as the euro weakened versus the US dollar, continuing concerns about debt in Europe spurred questions about the effect it will have on demand for metals, and on the possibility that China could see another round of tightening of monetary policy soon in an attempt to slow inflation.

Investors ignored positive data from the US on retail sales, factory output and consumer sentiment.

Copper was down 10 cents to $3.12 per pound in New York, while three-month contracts for the metal used in manufacturing and construction dropped $235 to $6,925 per tonne on the London Metal Exchange, although LME-monitored stockpiles fell 1,075 tonnes on the session.

Aluminium inventories were 3,725 tonnes lower while zinc stockpiles fell by 1,050 tonnes, but both remained near record highs.

The price of aluminium was down $69 to $2,101 per tonne even as United Company RUSAL (SEHK: 486), the largest aluminium producer in the world, said it expects prices for the metal to remain above $2,000 per tonne through the end of the year.

Lead was $120 lower to $1,940 per tonne while tin fell $250 to $17,550 per tonne and nickel dropped $1,295 to $21,555 per tonne.

Among precious metals, June gold closed $1.40 lower to $1,227.80 per troy ounce while May silver fell 27 cents to $19.20 per troy ounce and May platinum dropped $24 to $1,713.40 per troy ounce.