London 27/03/2013 - Base metals were lower in early trading on the LME on Wednesday, losing ground for the third consecutive day, with several setting four-month lows.
Trade remains light, however, with the approaching public holiday weekend encompassing Easter and the Jewish Passover already taking some participants out of the market. There will be no trade on Friday and Monday.
Cyprus remains the main focal point, with banks set to reopen tomorrow. But some still fear the possibility of a bank run after high deposit accounts were raided and the country's second largest bank was ordered to close to secure a 10-billion-euro rescue package from the EU, IMF and ECB.
There are also concerns that a similar levy on depositors could be repeated in other beleaguered eurozone countries.
"The depositor 'bail-in' in Cyprus and statements out of Brussels undermine depositors' confidence in Europe," Credit Suisse said in a note. "Depositors seeking relative safety might prefer well-capitalized non-eurozone banks over eurozone banks, and banks in stable northern eurozone countries over southern eurozone countries."
In data, the GfK German consumer climate number came in unchanged at 5.9. US February pending home sales are expected to show a decline of 0.3 percent. But US data yesterday showed that February durable goods orders increased 5.7 percent month-on-month, though the related core number declined 0.5 percent.
"Overall, this was underwhelming, offering another reason for markets to pause," FastMarkets analyst Jono Remington-Hobbs said.
Other indicators were broadly negative - the Consumer Board's confidence number came in at 59.7, down from 69.6; February new home sales registered 411,000, down from 437,000; and the Richmond manufacturing index dipped by three points from six to three.
In wider markets, equities are mixed. The Nikkei is up 22 points at 12,493 and the Hang Seng gained 153 points to 22,464. In Europe, the FTSE 100 fell 12 points to 6,387, while the DAX dipped 60 points to 7,819.
On currency markets, the euro is down two-thirds of a cent against the dollar at 1.279 - around an earlier four-month low - and the dollar index is up 0.28 at 83.16.
In other commodities, Brent crude oil seven cents lower at $109.44 per barrel and spot gold is teetering below $1,600 at $1,592.80 per ounce, down $6.40 on the overnight close.
ALUMINIUM, ZINC, LEAD SET FOUR-MTH LOWS
Copper was last at $7,592 per tonne, down $8 on Tuesday's close. By 10:40 GMT, only about 5,000 lots had changed hands on Select.
Copper stocks increased for the 30th consecutive day, rising a net 1,575 tonnes to 567,900 tonnes, with 1,500 tonnes entering Johor and 1,425 tonnes entering New Orleans. Cancelled warrants fell 750 tonnes to 64,550.
"Although global economic momentum has eased and rising risk aversion from the recent events in Europe dampened sentiment in the growth-sensitive copper market, we believe these factors are temporary," ANZ said in a note.
Aluminium fell to a four-month low at $1,906 earlier and was last still near this level at $1,907, down $5. Inventories fell 8,500 tonnes to 5,230,650 tonnes, with Vlissingen shedding 3,000 tonnes and Detroit 2,750 tonnes. Cancelled warrants rose 5,150 tonnes to 1,951,525 tonnes.
Zinc also hit its lowest since November 9 at $1,889.50 earlier and was last at $1,891.50, still down $23.50. Stocks and cancelled warrants both fell 2,000 tonnes to 1,182,700 tonnes and 712,425 tonnes respectively. Zinc was the most actively traded metal, with more than 7,200 lots changing hands on Select.
Lead was at its lowest since November 5 at $2,105, down $1.75. Inventories fell 1,500 tonnes to 264,475 tonnes and cancelled warrants are 1,500 tonnes lower at 139,850 tonnes.
Nickel was last at $16,714, down $66. Stocks rose 2,154 tonnes to 164,652 tonnes and cancelled warrants climbed 108 tonnes to 26,634 tonnes. Tin fell $400 to $22,750 even after 270 tonnes of material left warehouses, leaving the total at 13,835 tonnes. Cancelled warrants dropped 295 tonnes to 2,620 tonnes.
Steel billet was neglected while in the minor metals five lots of cobalt traded at an unchanged $25,500 and molybdenum was offered at $26,500.
(Editing by Mark Shaw)