Copper Holds Gains Near One-Week High Before China PMI

22/10/2014 07:49 AST

Zinc rebounded from the lowest in more than three months before a report projected to show sustained manufacturing expansion in China, the biggest consumer of industrial metals.

The metal rose as much as 0.6 percent in London, gaining for the first time in three days. A preliminary manufacturing gauge from HSBC Holdings Plc and Markit Economics for October will be 50.2, unchanged from the previous month, according to a Bloomberg survey before data due tomorrow. A reading above 50 indicates expansion. Chinese economic growth and U.S. home sales beat projections yesterday.

Global zinc demand will exceed production by 403,000 metric tons in 2014 and 366,000 tons in 2015, the International Lead and Zinc Study Group said Oct. 17. World demand will rise 5.1 percent this year, driven mainly by increasing usage in China for galvanized steel sheet production, according to the group.

“Investors are refocusing on stronger fundamentals for zinc after recent declines,” said Chae Un Soo, a metals trader at Korea Exchange Bank Futures Co. “They will closely watch Chinese manufacturing data tomorrow for direction.”

Zinc for delivery in three months on the London Metal Exchange climbed 0.2 percent to to $2,215.25 a ton at 10:55 a.m. in Tokyo. The metal closed at $2,210 yesterday, the lowest since July 1. Stockpiles tracked by the LME fell for a 29th day to 719,925 tons, the lowest since Aug. 12.

Copper in London was little changed at $6,656.75 a ton after gaining 1.7 percent yesterday, the most since Sept. 16. In New York, futures for December delivery slid 0.3 percent to $3.0205 a pound, while the contract for the same month in Shanghai climbed 1.3 percent to 47,130 yuan ($7,702) a ton.

On the LME, aluminum and lead declined, while nickel and tin were unchanged.

Bloomberg