Copper on track for first weekly gain in seven weeks

Copper was set for its first weekly rise in seven weeks after a deal between the European Union and the United States reduced fears that new trade barriers would erode demand for metals. Copper slumped from $7,348 a tonne in June to a one-year low of $5,988 last week on concerns that a trade war would damage economies including that of China, the world's largest consumer of metals.
But US President Donald Trump signalled a softer line this week with a deal with the EU to work toward eliminating trade barriers on industrial goods. Benchmark copper on the London Metal Exchange closed up 0.1 percent at $6,297 a tonne and was 2.4 percent higher this week. The most traded contract on the Shanghai Futures Exchange
also saw its first weekly gain in seven weeks, up 3.5 percent. Most other industrial metals also rose this week from last week's multi-month lows, but Trump's unpredictability meant any recovery was fragile, Capital Economics analyst Caroline Bain said.
"There's so much uncertainty that it (prices) could go either way," she said. "We're going to see more softness in the Chinese economy over the next few months which will prevent any significant rebound in metals prices for now."
China was working to soften the impact of trade disputes with a plan to put more money into infrastructure projects and ease borrowing curbs on local governments, sources told Reuters. Meanwhile, profit growth for China's industrial firms slowed slightly in June from the previous month as factory production slowed.
Supporting copper prices was the threat of a strike at Escondida in Chile, the world's largest copper mine, after its operator BHP made a final offer to workers with a wage rise that was less than unions demanded.
LME aluminium finished up 0.2 percent at $2,071 a tonne and was 2 percent higher this week, its first weekly gain in eight weeks. Data on Friday showed 37,375 tonnes of warrant cancellations, taking on-warrant stocks available to the market in LME-registered warehouses to 852,900 tonnes, the lowest since May 15 and pointing to tighter supplies.
Underlining concerns of restricted supply, one entity held 50-79 percent of aluminium warrants on the LME, one entity controlled 50-79 percent of copper warrants and one entity controlled 50-79 percent of zinc warrants.
Lead ended down 0.9 percent at $2,145 a tonne, tin closed 0.4 percent higher at $19,925, nickel gained 0.6 percent to $13,860 and zinc finished 0.4 percent lower at $2,596.