Copper rises as China signals economic support; US-Sino talks in focus
- Lifting market sentiment was China central bank governor's statement that economic fundamentals remain sound and the government will keep liquidity ample in the second half of this year.
SINGAPORE: Copper prices rose on Thursday amid "constructive" Sino-US talks and as Chinese policymakers assured traders the economy was gradually recovering from the coronavirus crisis, though a fresh wave of COVID-19 cases dampened hopes of a swift rebound.
Three-month copper on the London Metal Exchange rose 0.2pc to $5,779 a tonne by 0705 GMT, while the most-traded July copper contract on the Shanghai Futures Exchange advanced 0.3pc to 46,920 yuan ($6,630.12) a tonne.
Lifting market sentiment was China central bank governor's statement that economic fundamentals remain sound and the government will keep liquidity ample in the second half of this year.
In what Beijing described as a "constructive" meeting, US Secretary of State Mike Pompeo met with China's top diplomat Yang Jiechi amid a deep deterioration of ties between the strategic rivals, their first face-to-face meeting since last year.
"This may temporary ease the escalating political tensions between the United States and China," said analyst Helen Lau of Argonaut Securities.
However, prices were capped amid fears of wider contagion from a fresh outbreak in Beijing.
"There's a balance of negative and positive news," Lau said, adding copper's price outlook was positive amid lingering supply risks in South America and demand prospects from the Chinese home appliances, cars and property sectors, as well as the proposed $1 trillion infrastructure-focused US stimulus.
FUNDAMENTALS
FED: The US economy is beginning to recover but it will need more help, Federal Reserve Chair Jerome Powell told lawmakers.
ALUMINIUM: China's domestic aluminium prices
TIN: Top tin producer PT Timah targeted 2020 refined tin sales to drop 19pc year-on-year to around 55,000 tonnes.
OTHER PRICES: LME aluminium fell 0.3pc to $1,603.50 a tonne, and ShFE aluminium dropped 1pc to 13,745 yuan a tonne while ShFE lead climbed 1.3pc to 14,485 yuan a tonne.
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