LONDON: Copper prices fell on Tuesday as a firmer dollar and higher inventories triggered a bout of selling while the market looked ahead to surveys of manufacturers in top consumer China.
Benchmark copper was down 0.9% at $8,782 a tonne at 1602 GMT. Prices of the metal, used widely in power and construction, have fallen 8% since hitting 9-1/2 year highs of $9,617 last month.
“There’s no real fundamental news. The dollar is up, so are copper stocks and funds are selling,” a metal trader said. “Manufacturing PMIs towards the end of this week should give us clues to future demand.” Stocks of copper in LME registered warehouses rose 10,500 tonnes to 142,550 tonnes, a rise of more than 90% since the start of March.
Rising stocks have eased concern about availability on the LME market and narrowed the discount for the cash over the three-month contract to around $2 a tonne from nearly $50 a tonne at the beginning of March.
Support for copper prices kicks in at $8,550, the 55-day moving average, while resistance is at $8,982 where the 21-day moving average currently sits.
Aluminium prices in China will remain high in 2021, the president of state-run Chalco said, as a crackdown on energy use in Inner Mongolia leaves a question mark over supply.
Aluminium was down 1.5% to $2,231 a tonne, zinc fell 1.0% to $2,801, lead was up 0.6% at $1,969, tin ceded 0.2% to $25,310 and nickel lost 1.7% to $15,930.