Shanghai copper sank to a 3-week low and London copper hit a new 4-week low on Friday, on sharp falls in Shanghai stocks and worries over proposed limits on US bank trading operations and tighter Chinese monetary policy. The benchmark Shanghai Composite Index fell more than 3 percent on Friday afternoon in volatile trading, led by banking stocks before regaining some ground to end down about 1 percent.

Shanghai's benchmark third-month copper futures contract hit a 3-week low of 58,710 yuan a tonne, before ending at 59,480 yuan a tonne, down 2.4 percent. Shanghai copper ended 1.7 percent lower from a week earlier, the biggest weekly drop in 6 weeks. The most-active contract for May delivery fell 2.6 percent to 59,360 yuan a tonne.

Three-month copper on the London Metal Exchange hit a new 4-week low of $7,194, and regained the lost ground to edge up $7 to $7,272 by 0758 GMT, heading for a 2.2-percent weekly loss, its biggest since mid-December. Shanghai's copper stocks fell 3 percent from a week earlier to 97,308 tonnes.

Copyright Reuters, 2010