London copper edges up on weak dollar, hopes of easing Ukraine tensions

London copper prices edged higher on Monday, supported by a weaker dollar, while prospects of a de-escalation in Russia-Ukraine tensions bolstered appetite for risky assets.

US President Joe Biden and Russian President Vladimir Putin have agreed in principle to a summit over Ukraine, US and French leaders said. One condition for the summit was that Putin did not invade Ukraine.

Asian share markets pared sharp early losses and Wall St futures rallied following the news.

Three-month copper on the London Metal Exchange (LME) was up 0.3% at $9,985.5 a tonne as of 0255 GMT, while the most-traded March copper contract on the Shanghai Futures Exchange was steady at 71,540 yuan ($11,312.64) a tonne.

Copper edges higher

The dollar index dipped 0.3%, making the greenback-denominated metal cheaper for holders of other currencies.

Fundamentals

• LME aluminium eased 0.2% to $3,254.5 a tonne, lead slipped 1% to $2,324.5, zinc was flat at $3,576 and tin dipped 0.2% to $44,045. Nickel rose 0.5% to $20,435 a tonne, having earlier hit its highest since August 2011.

• ShFE aluminium fell 0.9% to 22,540 yuan a tonne, nickel rose 1% to 178,340 yuan, zinc shed 1.4% to 24,800 yuan, lead was down 0.9% at 15,350 yuan and tin dipped 0.2% to 336,600 yuan.

• Nickel stocks in LME-registered warehouses have fallen about 69% since April last year to 83,328 tonnes, while the premium for cash nickel over the three-month contract rose to $465 a tonne on Friday.

• Data last week showed copper inventories in warehouses monitored by the Shanghai Futures Exchange rose 27.9% to 136,300 tonnes from the previous week.

• Indonesia's PT Smelting, a joint venture between Mitsubishi Materials Corp and Freeport Indonesia, on Saturday launched construction of a 3.2 trillion rupiah ($223 million) expansion of its East Java copper smelting facility.

• Federal Reserve officials on Friday squelched what had been rising market expectations for an aggressive initial response to 40-year-high US inflation, signalling that steady interest rate hikes should be enough to do the trick.

• The state planner in China, the biggest metals consumer, said on Friday it will take steps to stabilise the commodity market and hasten construction of new infrastructure, in the effort to promote steady industrial growth.