LONDON: Copper prices edged higher on Wednesday in volatile trading after touching their lowest levels in almost three weeks as US Democratic presidential challenger Joe Biden opened up narrow leads in key states.
Copper whipsawed as President Donald Trump initially performed more strongly than expected before Biden moved ahead in Wisconsin and Michigan, giving him support on online betting markets.
Three-month copper on the London Metal Exchange had gained 0.4% to $6,840 a tonne by 1710 GMT as investors hoped for a clear election outcome. Despite bouncing from a low of $6,670, the weakest since Oct. 15, fading hopes of large US stimulus and infrastructure spending capped the gains.
Copper has rebounded 54% since March, bolstered by a strong recovery from the Covid-19 pandemic in top metals consumer China.
“Biden was widely expected to throw a lot of money into the system,” said Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen.
“A change to a Democratic White House would mean they would come out all guns blazing trying to achieve something in the first 100 days, but that’s potentially not going to happen, especially if they don’t get a Senate majority.”
Investors began pricing in a greater chance of gridlock in Washington as Republican incumbents were largely holding off Democratic challengers for control of the US Senate.
Helping turn most metals firmer, the dollar index erased earlier gains and fell, making metals priced in the US currency cheaper for buyers using other currencies.
Also supporting copper was news that a union of workers at Chile’s Candelaria copper mine had rejected yet another contract offer from the company and would push forward with a nearly month-long strike that has shut down the mine.
China’s Lygend Resources & Technology Co Ltd will not begin operating a nickel smelter at a project planned for eastern Indonesia until March 2021, a six-month delay.
Aluminium was little changed, up 0.03% to $1,906 a tonne after hitting a 19-month high of $1,913, while zinc climbed 0.7% to $2,584.
Nickel was the only metal in the red, last down 0.1% to $15,355 a tonne having touched $14,930, the lowest since Oct. 9. Lead gained 1.2% to $1,832.50 and tin added 0.7% to $18,200.—Reuters