Turmoil in financial markets has weighed on metal prices for several months

Tag : lead,copper
Authorities around the world stepped in to rescue three Europeanbanks while major central banks threw more resources at a deepeningcredit crisis, but it was not enough to calm markets.
World stocks tumbled more than 4 percent, on track for theirbiggest one-day loss in at least 20 years. Other metals alsotumbled, with aluminium falling to a nine-month low and leadsinking by more than 6 percent.
Copper for delivery in three months on the London Metal Exchangewas at $6, 545/6,565 by 1457 GMT, compared to $6,775 on Friday,having hit $6,510 -- its lowest level since December 2007.
"It's de-leveraging, risk aversion, fund selling, economic growthconcerns," said Daniel Brebner, global head of commodities at UBS,referring to the reason of the fall.
"All of these clearly reflect a tremendous amount of negativesentiment, negative momentum."
Turmoil in financial markets has weighed on metal prices forseveral months. Copper, used in construction, has lost more than 25percent since a record high of $8,940 on July 2.
The dollar extended losses against the yen amid rising riskaversion as foreign exchange investors expressed concerns aboutfurther instability in the global banking system following bankbailouts in Europe and the United States.
Leon Westgate at Standard Bank said the market also was focusing onsluggish demand for metals from the United States and Europe, andsaid that even if top copper consumer China was still doingrelatively well, its future looked uncertain.
"It is now up to the Chinese and it depends on how badly theireconomy has been impacted by this downturn," he said.
The Shanghai Futures Exchange will be shut this week for NationalDay holidays.
DEMAND DESTRUCTION
"Although the jury is still out as to whether the bailout packagewill work, there is much less debate about the fact that the macrostats coming out of the U.S. and the rest of the world continue tolook very bleak," Edward Meir at MF Global said.
"That is why this week's U.S. numbers are important, as they willgive us a better idea of how quickly the economy is resuming itsdownward slide," he said.
The Commerce Department said consumer spending was flat in Augustafter barely edging up by a revised 0.1 percent in July, a muchweaker outcome than forecast by Wall Street economists surveyed byReuters who had a 0.2 percent spending rise.
Fundamentals for particular metals did not look very promisingeither. For nickel, expectations are the market will show a surplusuntil 2011.
"The market is under pressure from supply growth and demanddestruction," it said, adding prices were forecast to bottom at $6per pound in 2009," Citi said in a note.
The metal, used by stainless steelmakers, was last at $16,600versus Friday's $17,000.
Lead fell more than 6 percent to a low of $1,835 a tonne. It wasquoted at $1,845/1,850 from $1,960 on Friday. Three-month zinc wasat $1,720/1,740 a tonne, down $50.
Lead and zinc have lost around a quarter and nickel has shed 35percent since the start of the year.
Aluminium lost $36 to $2,458/2,468 while tin was at $17,625/17,825from Friday's last quote at $18,100/18,105.