LONDON: Copper prices fell on Tuesday, under pressure from a stronger dollar and signs of muted demand from the world’s biggest metals consumer China, although a decline in available stocks on the London Metal Exchange curbed losses.
The benchmark three-month copper future on the LME lost 0.4% to $10,651.50 a metric ton by 1001 GMT.
Traders were looking for further updates on U.S.-China trade talks in the run-up to a planned high-stakes meeting next week between leaders of the world’s top two economies in South Korea.
However, data showing China’s economic growth slowed to a one-year low in the third quarter weighed on sentiment in the market for copper, used in power and construction.
“While Beijing is likely to introduce additional targeted support in the coming months, the broader message is clear: China is entering a slower, more mature phase of expansion. The old investment-driven model is losing momentum,” analysts at broker Sucden Financial said.
The Yangshan copper premium which reflects demand for China’s copper imports, fell 38% over the past month to $36 a ton, its weakest since July, as copper hit a 16-month high of $11,000 on Oct. 9 due to several mine supply disruptions.
Providing some support to the metal was daily LME data showing that available copper stocks in the LME-registered warehouses fell to 127,350 tons, the lowest since July, after 2,000 of fresh cancellations in South Korea.
On the technical front, the nearest moving average supporting copper is the 21-day at $10,529 a ton.
Among other LME metals, aluminium rose 0.2% to $2,781.50 a ton. A U.S.-Canada trade deal on aluminium, steel and energy could be ready for approval at a summit in South Korea this month, the Globe and Mail newspaper reported, citing sources familiar with the matter.
Zinc gained 0.9% to $3,003.50, lead added 0.2% to $1,992.50, tin was steady at $35,300, while nickel fell 0.2% to $15,190.
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