US copper futures lost some ground at the open on Wednesday, as a bearish backdrop of rising warehouse supplies and fears of slower economic growth prompted investors to take a defensive stance, traders said.
"There are so many things stacked up against copper right now that it's kind of out of favour, from a trader's perspective," said Larry Young, senior trader at Infinity Futures in Chicago.
Copper for December delivery was down 3.70 cents to $3.3045 a lb by 10:18 am EST (1518 GMT) on the New York Mercantile Exchange's Comex division, treading near the lower end of its $3.29-$3.40 morning trading band. Volume was estimated at 4,671 lots by 9 am.
"The question is: Will the base be seen as a potential catch up vehicle to invest in, or are the concerns driving safe-haven metals higher also warning of economic trouble ahead?" William Adams, metals analyst with BaseMetals.com, said in a daily market comment.
Young believed the impressive gains in the precious metal and crude likely caused some red metal investors to cash in and move their money into those faster-moving markets. "They go where the action is," he said. Fundamentally, Peru's Labour Ministry ruled on Wednesday that a strike by unionised mine workers across the country was illegal, a decision that would allow companies to fire workers participating in a walkout that started on Monday. Peru is the world's third-largest producer of copper.