Barring the last three weeks, copper has been rising relentlessly as funds were very positive about the red metal and its rising demand from heavy industries and consumer appliances makers.
Speculations are rife that aluminium and lead may follow copper because of weak market sentiment and speculative buying in the commodities market slowing down. Further, low vehicle sales in the US may keep the demand for lead acid batteries under pressure.
So, lead slipping to $1,600 cannot be ruled out. Zinc and nickel have already bottomed out and may move up, said an analyst.
Last week, copper remained subdued on stockpiling by China ahead of supply tightness anticipated post-Olympics. The world's largest consumer has already cut metal output heavily in order to protect the country's environment during the Games scheduled next month. The red metal declined about 2 per cent to settle the week lower at $8,324 per tonne as against $8,499 in the beginning of the week.
Stockpiles monitored by the Shanghai Futures Exchange gained 13 per cent last week to 42,935 tonnes, the highest since May 29. The Chinese production in the six months through June rose 19 per cent from a year earlier.
The copper futures for September delivery fell marginally by 1.2 per cent to $3.669 a pound on the New York Mercantile Exchange. The price declined 1.9 per cent during last week after dropping 5.3 per cent a week earlier.
Analysts said that metals prices are falling on concern that global slowdown and declining consumption in China will lower demand. The Chinse economy expanded at a 10.1 per cent annual rate in the second quarter, the slowest pace since 2005. The Chinese import of copper and alloys plunged 19 per cent last month from a year earlier.
The US is facing "significant" risks to growth as the housing market is facing the worst slump in 25 years and claims for jobless benefits are rising. Therefore, the demand of metals continued to remain under pressure from the industrialised and developing countries.
Copper has more than quadrupled in the past five years as mining companies, beset with strikes and falling ore grades, struggled to keep up with demand from China, India and other emerging economies.
On Friday, nickel dropped $375 to $20,400 per tonne after falling to $20,101 a tonne, the lowest since June 2006. Aluminum, the most energy-intensive industrial metal, recorded a weekly drop of 8.8 per cent to $3,025 a tonne.
