July 13 (Bloomberg) -- Copper dropped for a second day on concern that China's determination to rein in real-estate speculation will reduce demand for the metal used in pipes and wires. Aluminum was little changed after better-than-expected quarterly results from Alcoa Inc.
Copper for three-month delivery decreased as much as 0.3 percent to $6,610 a metric ton on the London Metal Exchange, before trading at $6,614.75 at 11:11 a.m. in Shanghai. Aluminum futures were at $1,973 a ton.
China's benchmark stock index fell the most in two weeks after the government quashed speculation it will abandon real- estate curbs that drove property prices to snap 15 months of gains. The country will "strictly" enforce housing policies, such as lending rules, to prevent speculative investment, the Ministry of Housing and Urban-Rural Development said today.
"We see a new round of declines looming on macro uncertainties," Shi Wenzhu, an analyst at Great Wall Futures Co., said from Shanghai. "Demand prospects in China are turning bearish too now that we're in the low-production season."
A boom in housing construction has led to a surge in China's appetite for raw materials. Copper has advanced 36 percent over the past 12 months on the global economic recovery, led by China, the largest metals user. Aluminum futures have gained 26 percent over the past year.
Global Consumption
Alcoa, the largest U.S. aluminum producer, reported second- quarter profit that topped analysts' projections yesterday as higher metal prices boosted sales. Stronger demand will increase global consumption 12 percent this year compared with the 10 percent gain previously forecast, the company said. Futures gained as much as 0.4 percent today.
Zijin Mining Group Co. said that a copper smelter at its Zijinshan mine has been closed after a leak. Heavy rain caused acidic wastewater to flow into a river, killing fish, the company said in a statement yesterday.
"A small copper smelter as Zijin doesn't pose any impact on domestic supplies," Great Wall's Shi said.
Copper for October delivery fell as much as 1 percent to 52,550 yuan ($7,756) a ton on the Shanghai Futures Exchange.
Zinc in London lost 1.6 percent to $1,825 a ton, lead fell 0.2 percent to $1,780 a ton and nickel was unchanged at $19,200 a ton. Tin had yet to trade.
