US copper futures steadied at slightly lower levels at the open on Tuesday, as broad-based selling in the metals complex and US data pointing to further softness in the housing sector weighed on buying interest, traders said.
"I think it's more of a sentiment move today," said Larry Young, senior trader at Infinity Brokerage Services in Chicago, adding that the lack of any news was keeping prices mired in their recent ranges.
Copper for September delivery was down 3.80 cents at $3.36 per lb by 11:01 am EDT (1501 GMT) on the New York Mercantile Exchange's COMEX division, near the bottom of its early $3.3540 to $3.3980 trading band.
By 10:00 am, futures volumes were estimated at 7,189 lots. Sales of new US homes fell 1.6 percent in May to a lower-than-expected level while prices climbed from April, according to a government report on Tuesday that continued to point to weakness in the housing sector.
New single-family home sales fell to an annual rate of 915,000 from a revised rate of 930,000 in April, the Commerce Department said. "These numbers are consistent with a framework that has the housing sector in recession, consumers losing their ardor to spend and investors worry that subprime problems are actually going to show up in a variety of places and may well have spilled over into the economy generally ...
"There was an expectation in the fall of last year that the spring selling season would right all wrongs in the housing market. Now the spring selling season is over and historically the period from the end of June to September there's very little activity.
So what I'm left to understand is the housing inventory has gotten bigger, the prices are still falling, manufacturers are cutting and the situation continues to deteriorate well into the summer and fall this year," said Joseph Battipaglia, chief investment officer with Ryan, Beck & Co in Florham Park, New Jersey.