Copper, industrial metals climb on macro optimism after US midterms

SINGAPORE: Copper and the industrial metals complex rallied on Thursday amid wider macroeconomic optimism as investor sentiment was boosted by yesterday’s US midterm election results.

Benchmark three-month copper on the London Metal Exchange was up 0.48% at $14,078.5 a metric ton by 0300 GMT.

The most-traded copper contract on the Shanghai Futures Exchange rose 0.71% to 108,250 yuan ($16,221.85) a ton.

Investors are hoping that a divided Washington will temper the worse of the policy unpredicability that buffeted global markets under the Trump administration.

Oil prices fell sharply overnight, with investors betting the shift of power in Washington would hasten the end of the US-Israeli war with Iran which has weighed on copper by dampening the global growth outlook.

Copper remained tight outside the US.

In biggest consumer China, the Yangshan premium, a gauge for its appetite for imported copper returned to $205 a ton on Wednesday, its highest in 12 years. Copper gains were tempered by fears that the Democrat victory could restrain the AI buildout.

The metal has benefited from hopes of demand growth tied to investment in AI infrastructure. South Korea’s technology-heavy KOSPI-index was down nearly 4% to near a seven-month low while Taiwan’s benchmark index and Japan’s Nikkei also fell.

Industrial metals were also boosted by weakness in the US dollar, which fell by 0.18%, making greenback-denominated commodities cheaper for buyers using other currencies.

Solar and clean energy stocks rose, as investors bet a Democratic sweep would help keep federal support for clean energy development in place.

Nickel, which is used in batteries and steel, was a particular winner.

On the LME it gained 2.26% and on the SHFE it rose 4.6%.

Among LME metals, aluminium gained 0.95%, zinc gained 0.55%, lead gained 0.77% and tin rose 1.61%.

Among SHFE metals, aluminium added 0.3%, zinc gained 0.83%, lead gained 0.53% and tin rose 2.98%.