Metals traded on the London Metal Exchange (LME) have closed lower after disappointing US durable goods orders dented demand expectations, while the stronger US dollar weighs on the appeal of greenback-priced metals.
At the close of open-outcry trading in the London ring on Wednesday, LME three-month copper was 0.6 per cent lower at $US7,020 a metric ton.
LME three-month aluminium closed 0.9 per cent lower at $US1,757 a ton.
Demand for long-lasting factory goods in the US fell in October, reflecting a broad drop in business spending that is weighing on the US recovery. Orders for US durable goods - products like farm equipment and computers designed to last longer than three years, which use a range of industrial metals - fell two per cent from September, after two months of increases, the Commerce Department said on Wednesday.
The report indicated businesses hunkered down during the 16-day partial government shutdown in October. The decline in demand was broad-based, covering everything from aeroplanes and machinery to computers and fabricated metals.
Excluding the volatile transportation category, durable-goods orders dropped 0.1 per cent, marking the third decline in four months.
The data dashed hopes for improving demand for industrial metals on the horizon, weighing prices lower toward the close Analysts surveyed by Dow Jones had forecast a 1.7 per cent drop in overall durable-goods orders in October.
Thin trading volumes are likely to be a feature of this week, with the Thanksgiving holiday in the US on Thursday.
"Very thin turnover has been the main overriding theme across the base metals complex," said Standard Bank analyst Leon Westgate Wednesday.
"Ahead of tomorrow's thanksgiving holiday in the US and what will likely be an extra long weekend for many, it is unlikely there will be too much in the way of fireworks aside from position squaring activity."
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