London copper firms but heads for weekly loss

Oct 16 (Reuters) - London copper firmed on Friday but was headed for a weekly loss, tracking sentiment in AI-related stocks, while aluminium was on track for a fourth straight weekly decline.

Benchmark three-month copper on the London Metal Exchange rose 0.9% to $14,468 a metric ton by 0308 GMT after hitting a near two-week low in the previous session. Prices were down 0.5% for the week.

The most-traded copper contract on the Shanghai Futures Exchange rose 0.4% to 110,170 yuan ($16,467.37) a ton.

Asian stocks rebounded following heavy selling in the previous session when investors dumped tech shares as questions about cloud company CoreWeave's debt pile fuelled worries about the financing driving the AI boom. MKTS/GLOB

The accelerating selloff in the semiconductor/AI space spilled over into copper, and the two areas have been tracking each other quite closely for much of the year, Marex analyst Ed Meir said.

Data showed US producer prices increased by the most in 4-1/2 years in September, the latest indication of inflation broadening out beyond energy products. Inflation tends to weigh on growth-dependent industrial metals by slowing economic activity.

Elsewhere, negotiations between Antofagasta Minerals and two striking unions at Chile's Centinela copper mine showed no progress. The Distrito Centinela and Minera Esperanza unions, which together represent more than 700 workers, began the walkout on October 7 after contract talks collapsed.

Citi is neutral on copper and aluminium in the near term at $14,000 to $15,000 per ton and $3,000 per ton, respectively.

LME aluminium rose 0.8% to $3,010, but was down 1.3% for the week so far. SHFE aluminium rose 0.8% after touching its lowest since July 21 on Thursday.

"What is behind the recent weaker tone is a sense that aluminium's supply-demand balance is turning more comfortable," Meir said.

Among other LME metals, zinc gained 1%, lead rose 0.6%, nickel firmed 0.4%, and tin added 1.8%.

Among SHFE metals, zinc slipped 0.2%, lead fell 0.2%, nickel lost 1.5%, and tin firmed 2.1%.

($1 = 6.6902 Chinese yuan renminbi)