Domestic commodities futures fell almost across the board Monday as uncertainty about China's soon-to-be-released third quarter gross domestic product (GDP), Chinese monetary policy, US corporate earnings and mixed economic data from the US and Europe undermined market sentiment.
The most traded copper contract on the Shanghai Futures Exchange (SHFE) fell 0.73 percent to close at 58,550 yuan ($9,337) per ton. The January contract managed to gain ground Monday after opening down more than 1.2 percent, largely in response to a drop in the three-month copper contract on the London Metal Exchange (LME) Friday.
The LME contract was trading down another 0.3 percent at $8,097 per ton when Chinese mainland markets closed Monday.
Base metals analysts reported that the markets lacked direction. "Investors are divided in their opinions on copper's outlook, which will keep London copper seesawing in small daily movements between $7,800 and $8,600," Andy Du, derivatives director at Orient Futures, told Reuters Monday. "I doubt China GDP figures will offer a big enough surprise to decisively sway either the bulls or the bears."
Monday's decline tracked a broadly negative session in international markets late Friday. Rumors that the Spain would request a bailout and that China's central government would cut how much money its banks have to keep in reserve - the latter of which was denied - shook the confidence of the market, according to commodities analysts from the Australian bank ANZ.
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