Poor economic data forces price of metals lower


Economic news is impacting on base metals again as all prices were down on the LME.

The cost of insuring against default on European sovereign and financial debt surged to record levels yesterday. This is an indication that markets fear more bad news to come from the eurozone countries.


Service sector activity in August was reported as poor in both the UK and China.  The HSBC purchasing managers index reading for China slowed to 50.6 (although this still represents annual expansion of 8 to 9 per cent). In the UK, the service sector PMI fell from 55.4 in July to 51.1 in August. US service sector PMI data due out today is also expected to be poor.

Three-month copper was down to $8,961 (£5,552) on Monday from $9,072 (£5,594) on Friday.

Aluminium dropped to $2,397 (£1,485) yesterday from $2,437 (£1,447) on Friday. Alloy was down to $2,290 (£1,419) from $2,300 (£1,418) at the end of last week.

Lead was at $2,430 (£1,505) from $2,505 (£1,545) on Friday. Nickel was lower at $21,050 (£13,041) from $21,600 (£13,319) on Friday.

Tin was down to $23,870 (£14,788) on Monday compared to $24,195 (£14,920) at the end of last week. Zinc was at $2,161 (£1,339) from $2,218 (£1,368) on Friday.

Steel dropped to $580 (£359) from $585 (£361) on Friday.