Copper Prices Drop on Weak Chinese Data
14 December 2018 - 10:52PM
Dow Jones News
By David Hodari
LONDON--Industrial metals prices fell Friday, putting them on
course to close out the week in negative territory as broader
markets dropped after data showed the Chinese economy continued to
slow.
The price of copper was down 1% at $6,090.50 a metric ton in
midmorning trade.
Gold was also down, by 0.2% at $1,239.65 a troy ounce, as the
U.S. dollar strengthened on haven buying. Weakness in both the
Chinese yuan and the euro--after the European Central Bank signaled
deepening concern over eurozone economic growth--was benefiting the
greenback.
The WSJ Dollar Index, which measures the U.S. dollar against a
basket of 16 other currencies, was last up 0.4%, extending its
five-day gains to 0.7%. Dollar-denominated commodities become more
expensive for holders of other currencies when the dollar
strengthens.
The currency moves came as a slew of economic data added weight
to investors' fears of a global economic slowdown.
Data released Friday showed a larger-than-expected deepening in
China's economic downturn last month. Slipping retail sales and
industrial production figures piled further pressure on Beijing to
halt a slowdown in 2019 while dealing with its continuing trade
conflict with the U.S.
"Without the front loading of exports, this was seen as a better
illustration of the poor state of the Chinese economy," said
Alastair Munro, a broker at Marex Spectron in a note.
China accounts for about half of global metals demand, and
concerns around trade tensions and a weakening economy have weighed
on metals prices through the second half of 2018. London copper
futures have lost 15% of their value in the past six months.
Elsewhere in the copper market, a strike blockade at Chilean
state-owned Codelco's mine at Chuquicamata was broken up by police
Thursday, with some unions officials being arrested.
That didn't end production disruption at Chile's third largest
copper mine, however, with the mine's smelter being one of two
Chilean operations shuttered after failing environmental
standards.
Investors were awaiting data out of the eurozone next week, as
well as next week's Federal Reserve meeting, at which the central
bank is expected to announce an increase in interest rates.
Among precious metals, silver was down 0.68% at $14.65 a troy
ounce, palladium was down 0.75% at $1,249.50 a troy ounce and
platinum was down 0.23% at $794.50 a troy ounce.
Among base metals, aluminum was down 0.26% at $1,925 a metric
ton, zinc was down 1.83% at $2,528 a metric ton, tin was down 0.1%
at $19,435 a metric ton, nickel was down 0.18% at $10,830 a metric
ton and lead was up 0.23% at $1,951.50 a metric ton.
Write to David Hodari at David.Hodari@wsj.com
(END) Dow Jones Newswires
December 14, 2018 06:37 ET (11:37 GMT)
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