Copper prices may see some correction next week as the market is unlikely to sustain further gain, mainly on lower Chinese buying amid higher inventories, traders said. In the London market, copper on Friday touched the $8500-mark.
?Initially, copper prices above $8,000 a tonne seems to be unattractive for Chinese investors and hence, prices have corrected again,? analyst said.
The LME stockpiles were down by 1,025 tonne on Thursday and cancelled warrants increased marginally by 125 tonne.
Shanghai inventories have been rising from the past four weeks. Any further increase may out further downward pressure on the prices and will just point towards the shifting of inventories from LME to Shanghai, sources said. Base metals ended down on Thursday on account of a slowing US economy and reducing Chinese demand.
?Now, the upside is limited. The resistance is seen at $8600 a tonne,? analyst said.
The slowing of the US economy will reduce the future demand for the metals as a slowing economy will lead to the decline in housing and industrial sector, which are the major application areas of the base metals, an analyst with Karvy Comtrade said.
Apart from the US factor, China?s import demand for the metals have been declining, especially for copper, as the metal above $8000 a tonne is pretty costlier for Chinese investors, he said.
The inventories have been rising as Chinese imports surpass the existing demand for the red metal.