ONDON, Jan 18 (Reuters) - Copper prices rose on Monday after a strong economic reading from top consumer China confirmed a growth trajectory that has underpinned demand for industrial metals.
China's economy grew 6.5% year on year in the fourth quarter, beating the 6.1% forecast by economists in a Reuters poll, with its recovery from the coronavirus crisis expected to gather pace this year.
Three-month benchmark copper on the London Metal Exchange (LME) gained 0.4% to $7,978.50 tonnes by 1700 GMT.
"The China data was pretty robust, not any great surprises there but just confirmation that China is back on track and that is a solid underpinning for metals," said independent analyst Robin Bhar.
Capping gains were concerns over the impact of a resurgance of coronavirus cases, with China reporting more than 100 new infections for a sixth consecutive day.
POSITIONING: The LME net speculative long was seen at 45% of open interest at Wednesday's close, levels last seen in September 2017, according to estimates by broker Marex Spectron.
INVENTORIES: Total stocks of copper in LME-registered warehouses slipped to their lowest since September at 97,675 tonnes.
SPREADS: The falling stocks have eased oversupply concerns, narrowing the LME cash copper's discount against the three-month contract to about $10 a tonne, compared with $23 on Dec. 22.
The amount of cancelled inventory - stock earmarked for delivery - was high at 44% and fuelled concerns over a shortage of LME copper.
ALUMINIUM: China produced 37.08 million tonnes of aluminium in 2020, setting an annual record as smelters cashed in on soaring prices, with December output also hitting a record monthly high even as the rally cooled.
Stocks of aluminium in warehouses approved by the LME jumped 112,000 tonnes to 1.39 million tonnes.
OTHER PRICES: LME aluminium shed 0.8% to $1,975 a tonne, zinc fell 0.6% to $2,682, lead gained 0.2% to $2,000.50, tin added 0.3% to $21,170 and nickel was up 0.4% at $18,075.- Reuters