Most base metals gain, but demand concerns linger


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BEIJING — Most base metals in London rose on Wednesday after data showed China’s factory activity contracted less than expected this month, but broad sentiment remained weak over manufacturing outlook in the world’s second-largest economy.

Three-month copper on the London Metal Exchange was up 1% at $7,940 a tonne, as of 0727 GMT. In the previous session, copper slid to its lowest in more than two weeks.

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China’s official manufacturing Purchasing Managers’ Index (PMI) rose to 49.4 in August from July’s 49.0 and beat expectations for 49.2 in a Reuters poll of analysts.

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It remained below the 50-point mark, however, reflecting a second consecutive contraction of factory activity amid COVID-19 flare-ups, power rationing and the challenges in its embattled property sector.

“Demand for copper rods picked up, recently improved power supply could bolster demand as downstream projects ramped up, but overall sentiment was still bearish amid a troubled property sector,” a trader said.

A survey showed China is struggling to emerge from the sluggish growth seen in the June quarter, with risks darkening the outlook as high inflation and the Ukraine war hit external demand.

China’s southwestern Sichuan province resumed its power supply to industrial and residential usage, and factories there have restarted their production after being ordered to shut down since Aug.15.

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LME aluminum rose 0.8% to $2,411.50 a tonne and zinc gained 1% to $3,515 a tonne, while lead declined 0.4% to $1,980 a tonne and tin dropped 1.4% to $23,320 a tonne.

The most-traded October copper contract on the Shanghai Futures Exchange lost 0.5% to 62,060 yuan ($9,002.03) a tonne.

ShFE aluminum fell 0.7% to 18,410 yuan a tonne, tin shed 1.9% to 191,080 yuan a tonne, zinc rose 0.2% to 24,965 yuan a tonne, and nickel climbed 3.5% to 170,570 yuan a tonne after hitting a one-month low on Tuesday.

For the top stories in metals and other news, click or ($1 = 6.8940 Chinese yuan) (Reporting by Siyi Liu and Domonique Patton; Editing by Uttaresh.V, Sherry Jacob-Phillips and Subhranshu Sahu)


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