LONDON: Copper prices slipped on Monday, weighed down by worries about demand after weak factory data from the United States and top metals consumer China.
A weaker dollar, hopes for more stimulus in China and prospects for a strike in top producer Chile cushioned the losses.
Three-month copper on the London Metal Exchange was down 0.5% at $9,678 a tonne at 1600 GMT, after falling by 1% on Friday.
US manufacturing activity grew at a slower pace in July for the second straight month, while China’s factory activity expanded at the slowest pace in 17 months.
Copper prices were firmer during most of the session ahead of the release of the US factory figures.
Metals are expected to retain an upside bias during the rest of the month, said Gianclaudio Torlizzi, partner at consultancy T-Commodity in Milan.
“The outlook for all base metals is bullish in August, supported by a weaker dollar after the latest dovish comments from the Fed. There are all the conditions for a spike higher,” Torlizzi said.
Torlizzi said he had taken bullish positions in copper, aluminium and nickel recently, and was targeting copper revisiting its record peak of $10,747.50, aluminium climbing to $2,700 and nickel rising to $21,000.
LME aluminium rose 1% to $2,616.50 a tonne, while nickel shed 0.2% to $19,505.
Also weighing on copper was profit-taking in options ahead of the LME option expiry on Wednesday, Alistair Munro at broker Marex said in a note.
The dollar index lurched back towards the one-month low hit last week, making dollar-priced metals cheaper to holders of other currencies.
The union of workers at BHP Group Ltd’s Escondida copper mine, the world’s largest, rejected the firm’s final labour contract offer.
LME cash zinc has moved to a premium of $1.50 over the three-month contract the first time in more than a year it has been more expensive, indicating tighter supply conditions. LME zinc rose 0.2% to $3,033.50 a tonne, lead gained 0.7% to $2,398 and tin climbed 0.5% to $34,825.
Comments
Comments are closed.