LONDON: Copper fell for a fourth straight session on Friday and was on course for its biggest weekly drop since March, weighed down by a rout in technology stocks, although supply concerns limited the downside.
Benchmark three-month copper on the London Metal Exchange was down 0.5 percent at USD13,775 a metric ton in official open outcry activity. It earlier declined as much as 1.5 percent to USD13,636, its lowest since July 30, but found support from its 200-day moving average. The metal, used in electrification and AI infrastructure including data centres, is on track for a 2.6 percent drop this week, which would mark its steepest weekly loss since the week ended March 20.
Nasdaq futures climbed on Friday as chip stocks gained ground after a technology-led slide on fears that Democratic control of the US Congress could lead to tougher AI regulation.
“Markets continue to digest implications from a blue wave,” Deutsche Bank head of metals research Daniel Ghali wrote, noting perceived reduced potential for US import tariffs on refined copper. The long-standing premium of copper prices on the US COMEX exchange over LME prices briefly flipped to a discount overnight before recovering.
Ghali said copper tariffs were firmly under President Donald Trump’s authority. “In our view, copper bears need a recessionary spiral from here, whereas copper bulls only need the status-quo trend to persist,” he wrote.
Copper stocks in Shanghai Futures Exchange warehouses fell more than 24 percent this week to just 33,848 tons — the lowest in almost three years and less than a day’s worth of Chinese consumption.
Underscoring the tightness, the Yangshan premium, a gauge of Chinese appetite for copper imports, rose to a record USD217.50 a ton. The cash LME copper contract was trading at a USD181-a-ton premium over the three-month forward, indicating near-term tightness outside the US. Aluminium fell 0.5 percent to USD3,049 a ton, zinc shed 1.6 percent to USD3,734, lead lost 0.5 percent to USD1,885 and nickel eased 0.2 percent to USD16,285 after jumping about 3 percent in the previous two sessions on concerns over shortages from Indonesia.
Tin was the sole gainer, climbing 1.7 percent to USD46,250 after Thursday’s 3.2 percent drop.