Copper falls 3.6 per cent
Funds have raided copper again, pushing prices to three-week lows in the market's biggest single-day loss in more than two months on persistent worries about demand from top consumer China and a stronger US dollar.
Benchmark copper on the London Metal Exchange closed down 3.6 per cent at $US5,080 a tonne, its biggest one-day loss since July 7, when funds were again behind the fall.
The metal used in power and construction hit a low at $US5,036 a tonne after New York opened and US-based funds seeing copper's losses and a higher US dollar jumped on the bandwagon.
Chinese government efforts to stimulate growth by easing fiscal and monetary policy have yet to bear fruit.
Poor prospects can be seen in recent data such as industrial production, which suggests little improvement.
"Prices are falling due to growth worries primarily related to China," said Julius Baer analyst Carsten Menke said.
Prices of industrial metals are also under pressure from the higher US currency, which makes dollar-denominated commodities more expensive for non-US firms. The dollar was up about 0.4 per cent, and has gained about 6 per cent in this year against a basket of currencies.
"It's just down to sentiment, which is poor, really poor," a trader said.
"There's reasonable volume and we've been triggering sell stops on the way down with everyone involved across the board, including our friends in the Far East."
Also behind worries about growth was the US Federal Reserve, which last week opted to keep interest rates on hold in a bow to worries about the global economy, which was interpreted by analysts as a reference to China.
"Today focus changed to fundamentals and to what is happening in China," SP Angel analyst Sergey Raevskiy said.
Three-month aluminium fell 1.7 per cent to $US1,589 per tonne. Zinc lost 1.8 per cent to $US1,628 per tonne, to near the 5-year lows hit last week.
Fears that substantial amounts of zinc could be heading to world markets have weighed further on fast falling prices, as major producer Glencore implements a plan to liquidate some of its inventories to help pay off debt.
Stocks of zinc in LME registered warehouses have risen more than 40 per cent to above 600,000 tonnes since early August.
"Zinc technically looks to be targeting the 2010 lows at $US1,577," a trader said.
Lead ended down 1.4 per cent at $US1,683 per tonne and nickel slid 1.7 per cent to $US9,690 per tonne.
Tin fell 2.3 per cent to $US14,800 a tonne after earlier hitting a three-week low at $US14,560 a tonne. The soldering metal is under pressure from expectations of higher shipments from top exporter Indonesia.