Copper hit six-year low on China worries

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    London copper prices subsided to fresh six-year lows near $US5,000 a tonne, as sentiment worsened over China's economy, hitting demand already struggling due to slow summer factory activity and a stronger dollar.

    "Overall, there's no sign of positive news flow on the demand side for copper from China," said analyst Helen Lau of Argonaut Securities in Hong Kong.

    Shares in China and Hong Kong fell as the yuan eased against the dollar, reigniting fears that Beijing may be intent on a deeper devaluation of the currency despite the central bank's comments that it sees no reason for a further slide.

    Jitters spilled into other markets, eclipsing brighter signs from China's property sector. Chinese home prices rose in July for a third consecutive month, fuelled by improved sales, suggesting the property market is slowly recovering.

    Three-month copper on the London Metal Exchange slipped by 1.5 per cent to $US5,030, following a 1.1 per cent loss in the previous session.

    Shanghai Futures Exchange copper fell 1.1 per cent to 38,790 yuan ($US6,059) a tonne.

    Other metals also fell, with LME zinc, nickel , lead and tin all dropping more than one per cent.

    Metals had already been under pressure as the dollar steadily gained ground. Focus has shifted back to the prospect of the Federal Reserve raising interest rates amid receding concerns that last week's devaluation of China's yuan could spark a global currency war.

    A stronger dollar makes commodities, priced in dollars, more expensive for holders of other currencies.

    In news, Noble Group is open to selling its core businesses, its chief executive said, as Asia's biggest commodities trader pursues options to boost market confidence after a bruising accounting dispute.

    In other metals, LME nickel prices were supported by cuts to mine supply, said Triland in a research note.

    South Africa's National Union of Mineworkers said on Saturday that its members would down tools at the Nkomati nickel mine operated by African Rainbow Minerals (ARM) and Norilsk Nickel after wage talks deadlocked.

    Also, Vale SA stopped operations at its Ona Puma nickel mine in Brazil's Amazon after a Brazilian federal court on Friday ordered the halt because of disputed payments to indigenous communities.

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