LONDON: Copper prices stumbled on Thursday for the fourth straight session as investors unloaded positions on persistent worries about demand in China and uncertainty about interest rates and global growth.
Three-month copper on the London Metal Exchange was down 0.8% to $7,888 per metric ton in official open-outcry trading, coming close to lows touched in May.
LME copper has lost 4.5% so far this week, on track for the biggest weekly decline since November 2022.
“The economic data isn’t conclusive on several fronts. The US has moderate strengthening in economic data, meaning it’s not clear that the Fed has reached the peak in monetary tightening,” said Nitesh Shah, commodity strategist at WisdomTree.
“The medium-term journey is for significant increases in copper demand for the energy transition, but the short term is a bit more difficult because demand remains weak from China, where the data is not indicating that its economy is pushing ahead in any meaningful way.”
A steep sell-off in bonds rattled financial markets including commodities on Wednesday as it pushed Treasury prices to 17-year lows and investors remain worried about US government spending and a ballooning budget deficit. Computer-driven Commodity Trading Advisor (CTA) funds have been behind a good deal of the selling, Al Munro at broker Marex said in a note.
“The base metals see no love with CTA sell programmes remaining in evidence as shorts rebuild on copper, ali (aluminium) and zinc.” Weak metals demand has been highlighted recently by rising inventories. LME copper stocks rose to 169,900 metric tons, the highest since May 2022 and more than tripling since mid-July, LME data showed on Thursday.
Comments
Comments are closed for this article.