Copper rises to 28-month high on stimulus hopes, stronger yuan

LONDON: Copper rose towards $7,000 a tonne on Wednesday for the first time since June 2018, helped by hopes for U.S. stimulus, strikes at mines in Chile, expectations of healthy demand in China and a strengthening yuan.

Benchmark copper on the London Metal Exchange (LME) was up 1% at $6,964.50 a tonne in official trading after earlier reaching $6,985.

The metal used in power and construction has risen 60% from a low in March as China, which consumes around half the world's copper, rebounded from the coronavirus shock.

Adding to the bullish mood were expectations of bigger stimulus if Joe Biden wins the U.S. presidency, and more Chinese demand after a meeting of China's leaders next week to discuss a five-year development plan, said ING analyst Wenyu Yao.

"In the short term, the market could remain well supported," she said.

CURRENCIES: The dollar slipped to its lowest in seven weeks while the yuan leapt to its strongest since July 2018, taking its gains against the dollar since May to 7% and making metals cheaper for Chinese buyers.

MARKETS: Global stocks fell.

STIMULUS: The White House and Democrats in the U.S. Congress moved closer to agreement on a new coronavirus relief package.

CHINA: China's fiscal revenues grew 4.7% in the third quarter from a year earlier, the finance ministry said, as economic recovery accelerated.

STOCKPILING: The prospect of China buying copper for its stockpiles is filtering through the market.

GLOBAL TRADE: The value of global trade is set to fall by 7-9% in 2020 despite China's rebound, the United Nations said.

CHILE: Miner Antofagasta said full-year copper output would be at the lower end of its original guidance of 725,000-755,000 tonnes.

STRIKES: Chile's Candelaria copper mine suspended operations from Tuesday after unions called for strikes. Workers at Codelco took to the streets on Monday to reject layoffs.

LEAD/ZINC: The global lead and zinc markets will be oversupplied in 2021, the International Lead and Zinc Study Group said.

OTHER METALS: LME aluminium was up 1.1% at $1,854.50 a tonne, zinc rose 1.6% to $2,569, nickel gained 0.5% to $16,101, lead added 2.4% to $1,808.50 and tin was 0.4% higher at $18,750.