LONDON: Copper prices firmed up on Thursday after China announced major investments in building power networks in Africa, but upside in the metal was limited by technical weakness.
The most traded three-month copper contract on the London Metal Exchange was up 1.8% at $9,117 a metric ton as at 1404 GMT, bucking the declines across the rest of the metals.
China on Thursday pledged nearly $51 billion in funding for Africa, with a focus on improving power networks whose shortcomings have delayed industrialisation in the resource-rich continent. Copper’s high conductivity means that is widely used in electricity transmission for wind and solar plants.
However, copper prices still remained below the 100 and 50-day moving averages, signalling technical softness, one trader said, adding that copper’s resilience is likely to be short-lived and prices
will soon dip below $9,000. “Every other metal has reverted back to previous levels after rallies in May,” the trader added.
Continued weakness in China’s property and construction sectors remain the main downside
risk for industrial metals, said ING commodities strategist Ewa Manthey.
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