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Copper down on global slowdown jitters
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Friday, 14 Oct 2011

Reuters reported that London copper slipped 1.5% as fears of the euro zone debt crisis and an economic slowdown in China continued to haunt base metals markets. Investors are cautious following a stalled vote on a key euro zone bailout fund by the last member of the bloc, Slovakia and are eyeing Chinese economic data later in the week.

1. Three month copper on the London Metal Exchange fell 1.5% to USD 7,178.25 per tonne by 0109 GMT after closing down 2.7% in the previous session.

2. The most-active December copper contract on the Shanghai Futures Exchange SCFc3 dropped 2.2% to CNY 53,010 per tonne after falling 0.5% in the previous session.

3. The parliament of tiny Slovakia stalled the expansion of a bailout fund to rescue the euro zone from its debt crisis on Tuesday but international lenders said they were likely to grant a loan to Greece next month, buying time for a broader response.

4. Slovakia's parliament brought down the government by rejecting a plan to expand the European Financial Stability Fund but the outgoing government said it hoped to pass the measure by the end of the week with opposition support.

5. Europe's banks will have to achieve a significantly stronger capital position under a quick fire regulatory health check and may need to raise some EUR 100 billion.

6. China's purchases of beaten down bank shares may be one of several baby steps along an easing path that eventually leads to interest rate cuts.

7. But some analysts also warned of Beijing's move may signal that Chinese banks are running out of capital and that the economy may be headed for a hard landing.

8. In a sign that global economic woes are starting to hit corporate earnings, Alcoa Inc the largest US aluminum producer, said that an economic slowdown hurt demand and knocked prices for the metal lower denting its Q3 profit and sending its shares down in after hours trading.

9. Indonesia's state owned PT Timah has started to again export tin ingot breaking a stoppage agreed by smelters last month.

10. Mr Vladimir Dmitriev head of VEB said that Russian state bank VEB will sign a deal with China Development Bank for CDB to provide USD 1.43 billion for building the first stage of UC RUSAL's 750,000 tonne Taishet aluminum smelter.

(Sourced from Reuters)

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