LONDON: Copper prices hit seven-week lows on Friday as demand and economic growth concerns were reinforced by news that US President Donald Trump had tested positive for coronavirus. But prices rallied in low volumes after weak US jobs growth data raised the chances of a stimulus package soon being agreed in the United States.
Benchmark Copper on the London Metal Exchange (LME) was up 2.8% at $6,568 a tonne at 1601 GMT. The metal, used widely in power and constructions, earlier touched $6,269, its lowest since Aug. 14.
"The news about Trump is bearish for industrial metals because he is seen as wanting to support growth and markets," one metals trader said, adding that a firmer dollar would cap copper's price gain. Signs the United States might fail to agree a bipartisan deal on a proposed $2.2 trillion stimulus package had earlier weighed on sentiment.
Trump said he and his wife, Melania, have tested positive for the coronavirus and will go into quarantine, only a month away from November's presidential election. "Although Trump seems to be healthy for the time being now, it raises concern about who else is sick, especially among the top echelons of Washington's leadership," said ED&F Man Capital Markets analyst Edward Meir.
"But we have to suspect that the usual business of government will plough ahead, with virtual meetings now likely replacing any in-person get together."
The Trump news triggered purchases of the US currency, a strengthening of which makes dollar-priced commodities more expensive for holders of other currencies and can weigh on demand.
Funds use this relationship to generate buy and sell signals using numerical models. Support for copper is at $6,250, an area of congestion from the middle of August. Aluminium rose 1.6% to $1,768 a tonne, zinc added 0.3% to $2,334, lead lost 1.2% to $1,785, tin gained 3.1% to $17,835 and nickel was down 0.5% at $14,420.
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