Copper Rebounds as Nikkei Futures Rise; Aussie Holds Drop


gsr-5COPPERCopper rose after the biggest two-day slump in 28 months and Japanese stock index futures advanced. The Australian dollar held declines before business confidence data, after iron-ore prices slid the most since 2009.

Copper futures added 0.4 percent to $3.0430 a pound on the Comex in New York after touching the lowest price since June yesterday. Nikkei 225 Stock Average futures rose 0.1 percent in the Osaka pre-market with contracts on the Standard & Poor’s 500 Index down 0.1 percent. The Aussie was steady at 90.27 U.S. cents by 10:22 a.m. in Sydney after slipping the past two days. Forward contracts on Malaysia’s ringgit and the Indonesian rupiah weakened as crude oil in New York dropped a second day.

A private gauge of Australian business sentiment is due today along with Philippine jobs data, while China’s central bank governor speaks to reporters and the Bank of Japan issues a statement on monetary policy. Global stocks extended declines from a more-than six-year high yesterday after disappointing Chinese data fueled concern over Asia’s biggest economy. In Crimea, Ukraine began military drills as Russia warned of “lawlessness” in the ex-Soviet republic’s eastern provinces.

“It’s just a technical rebound after plunging the previous two days,” Kaname Gokon, deputy manager of research at commodities broker Okato Shoji Co. in Tokyo, said by phone, referring to the copper futures. “Investors are still concerned over slowing economic growth in China.”

Copper futures in New York fell 5.8 percent in the previous two sessions, the biggest two-day slump since October 2011. Lead retreated 0.6 percent yesterday and zinc fell 0.8 percent.

China Impact

China, the world’s largest consumer of industrial metals, unexpectedly posted the biggest drop in exports since 2009 in data released March 8, while inflation slowed to a 13-month low. People’s Bank of China GovernorZhou Xiaochuan will hold a press briefing in Beijing today amid the annual National People’s Congress meeting.

The S&P/ASX 200 Index (AS51) in Australia, which counts China as its biggest trading partner, rose 0.1 percent today after sliding 0.9 percent yesterday. New Zealand’s NZX 50 Index lost 0.4 percent in a second day of declines.

Nikkei 225 Stock Average futures were bid at 15,170 by 8:05 a.m. in the Osaka pre-market, from 15,160 at the close in Japan yesterday. Nikkei 225 futures dropped 0.6 percent to 15,230 in Chicago. Futures on Hong Kong’s Hang Seng and Hang Seng China Enterprises indexes lost 0.6 percent in most recent trading while contracts on the Kospi Index in Seoul rose 0.2 percent after the measure slid the most in a month yesterday.

Iron Ore

The Aussie weakened against all 16 major currencies tracked by Bloomberg yesterday except for the South Korean won. Iron ore, Australia’s biggest export, delivered to China’s Tianjin port sank 8.3 percent to the lowest price since October 2012 yesterday, according to The Steel Index Ltd.

Benchmark prices for iron ore are down 27 percent since Aug. 14, when they reached a five-month high. Chinese imports of the material declined to 61.24 million metric tons in February from 86.83 million tons in January, customs data issued March 8 showed. Futures on Australia’s S&P/ASX 200 Index added less than 0.1 percent in most recent trading.

Of 24 emerging-market currencies tracked by Bloomberg, 19 weakened against the dollar yesterday, with the Bloomberg Spot Dollar Index, which gauges the greenback against 10 major peers, rising 0.1 percent. The MSCI Emerging Markets Index fell 1.2 percent, the biggest slump in a week, while Brazil’s Ibovespa (IBOV)slipped 1.5 percent to the lowest level since July as commodity exporters including iron-ore producer Vale SA tumbled. China is also Brazil’s largest trading partner.

Emerging Markets

One-month non-deliverable forwards on Malaysia’s ringgit weakened a third day today, losing 0.3 percent to 3.2907 per dollar after the currency dropped 0.8 percent yesterday in its steepest one-day decline since Sept. 30. Similar forwards on Indonesia’s rupiah fell 0.5 percent.

Twelve-month NDFs on China’s yuan were little changed at 6.1795 a dollar in early trading. The People’s Bank of China weakened the yuan’s reference rate by 0.18 percent yesterday, with the currency declining 0.2 percent to 6.1385 per dollar, according to China Foreign Exchange Trade System prices.

The Dow Jones Industrial Average lost 0.2 percent in New York. Boeing Co. dropped 1.3 percent after a 777-200 plane disappeared with 239 passengers and crew during a Malaysia Airline System Bhd flight to Beijing March 8. Cliffs Natural Resources Inc. slid 3.8 percent and Freeport-McMoRan Copper & Gold Inc. lost 2.5 percent, among the biggest declines in the S&P 500.

U.S. Treasuries

Chiquita Brands International Inc. soared 11 percent after the owner of the namesake banana label agreed to buy Dublin-based Fyffes Plc in an all-stock transaction that values Fyffes at about $526 million.

Yields on 10-year U.S. Treasuries fell one basis point, or 0.01 percentage point, to 2.78 percent in New York, the first decline in five days. Australian 10-year bonds snapped a five-day decline today, with yields falling one basis point to 4.2 percent.

Economists projected U.S. payrolls would rise by 149,000 last month, with the bigger-than-expected 175,000-worker increase in data released March 7 indicating the economy is starting to bounce back from frigid winter weather.

Federal Reserve Bank of Philadelphia President Charles Plosser, who votes on central-bank policy this year, said recent encouraging economic reports aren’t enough to change the Fed’s approach to its bond-buying program, which has been reduced twice this year.

Plosser, Evans

“The hurdle rate for change is pretty high in either direction,” Plosser said in a Bloomberg TV interview with Manus Cranny in Paris, referring to the Fed’s tapering of its stimulus program.

Fed Bank of Chicago President Charles Evans said in a speech yesterday that he expects the U.S. economyto expand at a rate of 2.5 percent to 3 percent in 2014. Fed Chair Janet Yellen said last month the economy is robust enough to withstand measured cuts to monetary stimulus.

West Texas Intermediate crude oil fell 0.2 percent to $100.95 a barrel in early trading.

Corn futures for May delivery decreased 2.2 percent to close at $4.7825 a bushel on the Chicago Board of Trade, the biggest drop for a most-active contract since Nov. 18. The U.S. Department of Agriculture raised its outlook for world corn inventories before the 2014 Northern Hemisphere harvests by 0.7 percent to 158.47 million metric tons, topping analyst estimates.

Soybean futures for May delivery fell 2.7 percent to $14.1875 a bushel, the biggest decline since Jan. 21. Futures have climbed 9.8 percent this year.