METALS-Copper climbs on supply risks in Chile, Indonesia

By Lucas Liew

Oct 2 (Reuters) - Copper prices climbed on the London Metal Exchange on Thursday, buoyed by supply concerns in top producer Chile and major supplier Indonesia, while a weaker dollar provided additional support.

Three-month copper on the London Metal Exchange CMCU3 rose 0.33% to $10,413.5 per metric ton by 0301 GMT.

Weaker industrial activity across many parts of the world is being outweighed by mounting supply risks in Chile and Indonesia, while China's anti-involution drive is adding to bullish market sentiment, said ANZ analysts.

Anti-involution is China's move to end aggressive price wars in several sectors and damaging the economy.

Chile's copper output declined 9.9% year-on-year in August, its sharpest drop in over two years, per data from statistics agency INE on Tuesday.

The dollar index =USD, which measures the U.S. currency against six major peers, hovered near a one-week low of 97.459 reached overnight. It last stood at 97.672, slightly down from Wednesday's close, as a weak U.S. labour report bolstered bets for rate cuts. USD/

A softer dollar makes greenback-denominated assets more affordable to holders of other currencies. FRX/

Meanwhile, copper stocks in the LME warehouse system MCUSTX-TOTAL fell to 141,725 tons, their lowest since the start of August.

China's manufacturing activity shrank for a sixth month in September, an official survey showed on Tuesday, with the Purchasing Managers' Index at 49.8, below growth threshold of 50.

Chinese markets are closed from October 1 to 8 for the Golden Week holiday.

Among other London metals, aluminium CMAL3 increased 0.26% to $2,695.5 a ton, lead CMPB3 gained 0.5% to $2,020.5, tin CMSN3 rose 0.24% to $36,100, and zinc CMZN3 strengthened 0.28% to $2,996, while nickel CMNI3 eased 0.06% to $15,175.

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DATA/EVENTS (GMT)
1230 US Initial Jobless Clm 27 Sep, w/e

1400 US Factory Orders MM Aug

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