London copper prices rose on Tuesday after hitting a two-week low in the previous session, as the dollar eased, although demand concerns due to rising COVID-19 cases in top consumer China kept gains in check.
Three-month copper on the London Metal Exchange was up 1% at $7,962.50 a tonne, as of 0215 GMT.
The most-traded December copper contract on the Shanghai Futures Exchange fell 0.6% to 64,720 yuan ($9,048.84) a tonne, its lowest since Nov. 4.
China’s capital warned on Monday that it was facing its most severe test of the COVID-19 pandemic, with a surge in COVID-19 cases sparking fresh restriction measures. Deaths from the virus were also recorded in Beijing for the first time since late May.
Shares in the Asia Pacific fell in early trading on Tuesday, as the situation in China deepened concerns over supply chain disruption.
New China COVID curbs push copper to two-week low
The dollar index fell 0.2% against its rivals. A weaker dollar makes the greenback-priced metal less expensive for buyers holding other currencies.
Climbing inventories due to slowing demand and mounting mine supply are set to hit copper prices over coming months, with the move exaggerated by speculators cutting bets on higher prices of the metal used in power and construction.
Copper stocks in LME registered warehouses at 91,250 tonnes are up more than 15% since Nov. 10.
Expectations around smaller rate hikes from the U.S. Federal Reserve also buoyed sentiment among investors, with Cleveland Fed President Loretta Mester supporting smaller rate increases in December.
LME aluminium rose 0.4% to $2,388 a tonne, lead gained 0.9% to $2,120 a tonne, tin climbed 1.1% to $21,395 a tonne and zinc was up 0.6% to $2,924 a tonne.
SHFE nickel rose 0.7% to 199,330 yuan a tonne, lead eased 0.1% to 15,725 yuan a tonne, tin fell 1.1% to 178,730 yuan a tonne, zinc dipped 2.4% to 23,750 yuan a tonne and aluminium lost 0.3% to 18,945 yuan a tonne.
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