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Date: 13/03/2008
The May copper contract the most active on the Shanghai Futures Exchange, rose 1,620 yuan to 69,460 yuan a tonne at midday. Spot copper in Shanghai rose 800 yuan to between 68,300 and 68,600 yuan.
Copper for delivery in three months on the London Metal Exchange eased $25 to $8,665, having risen 3.3 percent in the previous session. Copper is closing in on the record high of $8,800.
"In Chinese superstition $8,800 is a good number, but consumers might not feel that way when it comes to copper prices," a trader in Shanghai said.
"London futures will break that level, but Shanghai prices are still lagging, weighed down by sluggish spot prices in the domestic market."
With copper and aluminium just a few dollars short of record highs and gold close to $1,000 an ounce, dealers expect more upside pressure on commodities, even if fundamentals alone may not justify the heady levels.
"The recent rally is purely based on speculative interest rather than fundamentals," Judy Zhu, commodity analyst at Standard Chartered Bank, said.
"Demand is strong but not that strong. Investors should be cautious."
Zhu said that $10,000 to $12,000 a tonne for LME copper was possible even though fundamentals could not justify those levels.
"Gold prices are the key for those interested in copper. As gold continues higher, so will copper."
Spot gold touched a record high of $991.80 on Wednesday, and Zhu said a move to $1,000 and beyond was highly likely.
Copper stocks fell in London by 1,400 tonnes to 138,150, down by about a third since the start of the year and enough for less than three days of world consumption.
Aluminium rose $7 to $3,215, just 3 percent below its record peak of $3,310 set in May 2006. Shanghai aluminium rose 2 percent to 21,315 yuan a tonne.
Shanghai's May zinc contract rallied 2.3 percent to 22,655 yuan, while LME zinc rose $5 to $2,820 after it gained 1.3 percent on Wednesday.
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