Copper Climbs in Shanghai on Chinese Stimulus, Bank of America

The U.S. government agreed to invest $20 billion more in Bank of America and guarantee $118 billion of assets, the Treasury Department, Federal Reserve and Federal Deposit Insurance Corp. said in a statement in Washington.
 

"The market will take direction from spillover optimism in other markets and we'll continue to see investors buying on dips," Yuan Fang, a trader at Shanghai East Asia Futures Co., said today. "We're not going to see any major rallies in the near-term as demand continues to be weak."
 

Copper for April delivery on the Shanghai Futures Exchange jumped as much as 5.2 percent to 27,770 yuan ($4,062) a metric ton, and ended the day at 27,470 yuan. London Metal Exchange copper was up 2.9 percent at $3,375 at 4:32 p.m. Singapore time.
 

China's National Development & Reform Commission and the Ministry of Industry & Information Technology will review a stimulus package today to help machinery companies, Shanghai Securities News reported, without citing anyone.
 

China faces an economic "hard landing" with growth slowing to 6 percent or less this year, the weakest pace since 1990, Fitch Ratings said today.
 

That would be less than half the 13 percent pace that pushed China past Germany to become the world's third-biggest economy in 2007, according to revised Chinese statistics released this week.
 

'Alarming' Stockpiles
 

Stockpiles monitored by the London Metal Exchange stood at a five-year high of 387,325 tons yesterday, while inventories in Shanghai fell 30 percent this week before the Lunar New Year at the end of the month.
 

"We still see inventories growing at fairly alarming rates as demand really drains away," said Geoff Clear, executive director and head of commodities at Australia & New Zealand Banking Group.
 

"It's a typical market environment for a demand shock situation that's what we're seeing right now," Clear said in a Bloomberg Television interview. "Until we see some of that stockpile disappear, we wouldn't expect those prices to rally very far at all, so we're going to see base metals bumping along the bottom for some time to come."
 

Among other LME-traded metals, aluminum was up 0.3 percent at $1,485 a ton, zinc rose 1.4 percent to $1,280, and nickel added 1.7 percent to $10,875 as of 4:33 p.m. Singapore time. Lead and tin were little changed at $1,155 and $11,000 a ton respectively.