METALS-Base metals fall on weak trade data from China

* GRAPHIC-2018 asset returns: (Updates throughout, changes dateline from SINGAPORE)

By Zandi Shabalala

LONDON, March 8 (Reuters) – Nickel and zinc fell on Friday after trade data from top consumer China pointed to a slowing economy despite recent stimulus measures, denting demand expectations for base metals.

China’s exports fell by the most in three years in February while imports fell for a third straight month, pointing to a further slowdown in an economy which is at its weakest in almost 30 years.

“The optimism that has been built up from an upcoming trade war deal has dissipated as underlying data shows that the picture isn’t as optimistic as everybody expected,” said BMO Capital Markets analyst Kash Kamal.

U.S President Donald Trump said this week that talks aimed at ending a long-standing trade conflict with China were moving along well after he postponed a sharp U.S. tariff hike slated for early March.

The optimism flowed into base metals, with nickel climbing the most among metals so far this year.

Benchmark zinc was bid down 1.3 percent to a two week low of $2,700 per tonne on Thursday, while nickel was bid down 1 percent to $13,110, after failing to trade in official rings.

STIMULUS: China this week sought to shore up its slowing economy through billions of dollars in planned tax cuts and infrastructure spending, with economic growth hit by softer domestic demand and a trade war with the United States.

But the impact of stimulus on the slowing Chinese economy is due to take six to nine months to flow through to demand for industrial metals, giving a boost to prices in the second half of the year.

COPPER: China’s unwrought copper imports fell year-on-year in February to their lowest in 11 months, while copper concentrate imports rose to tie with the all-time monthly record, signalling that the world’s top copper consumer is churning out more metal itself.

Three-month copper was bid down 0.9 percent to $6,366 per tonne.

STOCKS: Inventories in LME-registered warehouses stood at 116,725 tonnes, the lowest since 2008. MCUSTX-TOTAL

SPREADS: The premium of cash LME copper over the three-month contract CMCU0-3 was at $35.50 a tonne after touching its highest since January 2015 at $70 earlier this week.

INDONESIA: The Indonesian government has approved one-year export allowances for copper concentrate for miners PT Freeport Indonesia and PT Amman Mineral Nusa Tenggara, officials from the Ministry of Energy and Mineral Resources said.

EQUITIES: Investors dumped “risky” assets such as metals and world stocks in the wake of the weak Chinese data, a day after European policymakers slashed growth forecasts for the bloc.

PRICES: Aluminium was bid higher by 0.3 percent at $1,870 tonne, lead fell 0.7 percent to $2,090 while tin slipped 0.3 percent to $21,400.

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