LONDON: Copper prices edged up on Thursday on relief over strong results from AI giant Nvidia, but a strong dollar and concern about demand in top metals consumer China weighed on the market.
Benchmark three-month copper on the London Metal Exchange was up 0.3percent at USD10,787 a metric ton by 1030 GMT, extending modest gains made in the previous session.
LME copper has gained 22percent so far this year, but has retreated from its record peak of USD11,200 touched on October 29. Nvidia surprised Wall Street after markets closed on Wednesday with accelerating growth after several quarters of slowing sales. “I expect that there’s going to be weakness in the broader economy, but as long as tech is healthy and the infrastructure build-out from tech remains robust, that’s going to be good for the base metal markets,” said Nitesh Shah, commodity strategist at WisdomTree.
Many analysts expect copper to benefit from the wiring needed for a surge in the number of AI data centres being built. The gains, however, were dampened by a firm dollar index after minutes released by the US Federal Reserve made a December US rate cut seem less likely. A stronger dollar makes commodities priced in the US currency more expensive for buyers using other currencies. Also weighing on the market are concerns about weak copper demand in China.
“Copper consumption in China has largely disappointed, with run rates at fabricators at multi-year lows for the season,” Neil Welsh, head of metals at Britannia Global Markets, said in a note. The most-traded copper contract on the Shanghai Futures Exchange closed daytime trading up 0.14percent at 86,080 yuan (USD12,099) per metric ton.
China imported 279,944 tons of copper cathodes in October, down 22.1percent year-on-year and 15.7percent on a monthly basis, according to official customs data on Thursday.
Aluminium rose 0.5percent to USD2,815, zinc gained 1percent to USD3,011, lead edged up 0.2percent to USD2,018.50, tin also added 0.2percent to USD37,025, while nickel fell 1percent to USD14,505.
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