Copper yesterday settled down by -2.15% at 399.80 as poor factory output data from China, the top user of the metal, fed fears that demand growth was stalling as copper inventories rose. Data on Monday showed China's factory output growth was surprisingly weak in April, while fixed-asset investment also slowed, rekindling concerns that a nascent recovery in the world's top copper consumer is stalling. The numbers initially lifted copper prices on hopes they would prompt Beijing to ease monetary policy, but those hopes were dashed on Tuesday after comments in China's official media suggested the government was unlikely to follow that route. Copper hit its highest in nearly a month last week at 411.50. It has clawed back around 9 percent from 18-month lows below 366.30 touched on April 23, but is still down almost 7 percent for the year. Market data out earlier also showed LME stocks of the metal rose by 12,000 tonnes to 618,700 tonnes, edging back towards a recent peak of 621,600 tonnes, which was the highest in almost a decade. Copper stocks had been falling in recent weeks, but overall levels remain elevated and market expect a surge of new supply from mines this year. Also miner Glencore Xstrata said copper output rose 18 percent in the first quarter of 2013 as new operations expanded to substitute depleted mines and output climbed at its legacy operations in Congo. Technically market is getting support at 396.0 and below same could see a test of 392.33 level, And resistance is now likely to be seen at 405.6, a move above could see prices testing 411.5.

Trading Ideas:

Copper trading range for the day is 392.3-411.5.

Copper dropped as poor factory output data from China, fed fears that demand growth was stalling as copper inventories rose.

China's factory output growth was surprisingly weak in April, while fixed-asset investment also slowed

Copper daily stocks at Shanghai exchange came down by 451 tonnes