Copper slides on China demand concerns
BEIJING, Aug 1 (Reuters) - London copper kick-started the month on a softer note, weighed down by concerns about demand from top consumer China, even as the U.S. Federal Reserve hinted at a September rate cut.
Three-month copper on the London Metal Exchange was down 0.5% to $9,183 per metric ton, as of 0714 GMT on Thursday, after declining 5.9% in July.
Thursday's losses came after a private sector survey showed that China's manufacturing activity in July shrank for the first time in nine months.
The reading was in line with an official PMI survey on Wednesday showing manufacturing activity slipped to a five-month low.
Copper prices have fallen by 17% since hitting a record high in late May, due to weaker-than-expected demand from China amid a protracted property sector crisis.
The country also exported more copper to overseas markets, leading to an increase in global inventories.
However, ANZ analysts said in a note on Thursday that there were some positive signs of narrowing export parity and retreating inventories, which could support prices.
On Wednesday, Fed Chair Jerome Powell said interest rates could be cut as soon as September if the U.S. economy follows its expected path.
A rate cut could boost economic activities and support industrial demand.
Powell's remarks also weighed on the dollar index, making greenback-priced metals cheaper for overseas buyers.
The most-traded September copper contract on the Shanghai Futures Exchange rose 1.6% to 74,780 yuan ($10,334.58) a ton.
Elsewhere on the LME, prices were mixed. LME aluminium was up 0.1% at $2,293.50, zinc nudged 0.1% higher to $2,677, tin eased 0.3% to $29,980, lead lost 1% to $2,062.50, and nickel slipped 0.4% to $16,540.
SHFE aluminium increased 1.2% to 19,235 yuan a ton, zinc gained 0.6% to 22,785 yuan, tin advanced 2.4% to 249,900 yuan, nickel rose 1.8% to 132,250 yuan, while lead moved 0.6% lower to 18,660 yuan.
For the top stories in metals and other news, click or ($1 = 7.2359 Chinese yuan) (Reporting by Siyi Liu and Colleen Howe; Editing by Sherry Jacob-Phillips and Subhranshu Sahu)
