London copper was set for a second straight quarterly gain on Thursday, even as prices dipped for the day on concerns over demand in top consumer China, which is grappling with its worst resurgence of COVID-19 cases since early 2020.
Three-month copper on the London Metal Exchange dropped 0.5% to $10,314 a tonne by 0702 GMT, after a 0.5% rise in the previous session partly driven by a weak US dollar.
The most-traded May copper contract on the Shanghai Futures Exchange ended daytime trade 0.5% lower at 73,320 yuan ($11,560.66) a tonne.
London copper eases on China demand worries, Shanghai nickel falls
The metal often used as a gauge of global economic health has gained more than 6% on the LME in the first quarter largely due to supply concerns.
China’s top smelters have raised by more than 14% their floor treatment and refining charges for copper concentrate in the second quarter, suggesting supply concerns have eased.
But Wenyu Yao, a senior commodity strategist at ING, would not rule out spikes in market volatility in the second quarter. “The largest downside risks could be that a forceful policy required to curb inflation negatively spills over to financial sentiment and the real economy, and a prolonged COVID combat that could hurt demand harder (in China),” she wrote in a note.
CHINA: China’s factory activity contracted in March as the economy faced renewed downward pressures from stringent COVID controls.
POLICY SUPPORT: China will roll out policies to stabilise the economy as soon as possible as the downward pressure in the economy increased, state media CCTV quoted a cabinet meeting as saying on Wednesday.
EV BATTERIES: US President Joe Biden could invoke a Cold War-era defence law as soon as this week to encourage domestic production of minerals needed to make electric vehicle batteries, according to two sources familiar with the matter.
DOLLAR: The US dollar remained broadly weaker, making greenback-denominated metals cheaper for users of other currencies.
LME PRICES: Aluminium slipped 0.7% to $3,527.50 a tonne, zinc was virtually flat at $4,148, lead dropped 0.1% to $2,415, while tin gained 0.3% to $42,620. Nickel shed 0.9% to $32,615 a tonne.
SHANGHAI PRICES: Aluminium gained 0.2%, zinc rose 0.8%, nickel fell 1.3%, lead climbed 1.2%, and tin dropped 0.3%.
Comments
Comments are closed for this article.