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Copper extends losses on firm dollar and China worries



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Updates prices, adds analyst comment, changes dateline to LONDON

By Eric Onstad

LONDON, Oct 10 (Reuters) -Copper prices dipped on Thursday, weighed down by a strong dollar and uncertainty over how much more economic stimulus will be unleashed in top metals consumer China.

Three-month copper CMCU3 on the London Metal Exchange (LME) was down 0.2% at $9,657 per metric ton by 0930 GMT, having hit its lowest in more than two weeks on Wednesday.

Prices have returned to levels reached before China started announcing supportive measures for its flagging economy, which have been below expectations and lacked detail.

"Metals will probably be in a holding pattern ahead of a catalyst that will hopefully come when the minister of finance holds a press conference," said WisdomTree commodities strategist Nitesh Shah.

China's finance ministry will detail plans on fiscal stimulus to boost the economy at a news conference on Saturday.

"If a fiscal package has significant amounts of actual spending on the real estate sector, possibly combined with further support for new energy infrastructure, we may start to see some of the stockpiles come down," Shah said.

The most traded November copper contract on the Shanghai Futures Exchange (SHFE) SCFcv1 closed 1% down at 76,870 yuan ($10,869.93) a ton, tracking overnight losses in London.

However, demand risk remains.

"The latest rally in copper prices, as well as the (Oct. 1-7) National Day Holiday, has weakened purchasing interest of semis manufacturers, especially copper wire rod players," said Wood Mackenzie consultant Zhifei Liu.

LME copper prices have declined 1.3% this month after rising 6.4% in September for the best monthly gain since April.

Also pressuring metals was a strong dollar =USD, making commodities priced in the U.S. currency more expensive for buyers using other currencies. FRX/

Among other metals, LME aluminium CMAL3 rose 0.5% to $2,554.50 a ton, nickel CMNI3 added 0.3% to $17,420, zinc CMZN3 was up 0.8% at $3,045.50 and tin CMSN3 rose 0.5% to $32,655 while lead CMPB3 slipped 0.4% to $2,053.50.

For the top stories in metals, click TOP/MTL

($1 = 7.0718 yuan)



Reporting by Eric Onstad
Additional reporting by Mai Nguyen in Hanoi
Editing by David Goodman

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