Base Metals Follow Stocks, Oil Lower
07 December 2018 - 6:18AM
Dow Jones News
By David Hodari and Amrith Ramkumar
Copper slumped alongside stocks, oil and other risk assets
Thursday as fresh worries about a slowing global economy roiled
markets.
Copper for March delivery, the most-active contact, fell 1.1% to
$2.7430 a pound on the Comex division of the New York Mercantile
Exchange. Fears that the tariff fight between the U.S. and China
will weaken global growth and lower demand for industrial materials
used in construction and manufacturing have sent prices down about
17% from their June four-year highs.
Although prices edged higher early in the week after the U.S.
and China signaled progress on resolving their trade spat, some
analysts are skeptical the two sides can quickly come to an
agreement. The recent arrest by Canadian authorities of Huawei
Technologies Co.'s chief financial officer at the request of the
U.S. for alleged violations of Iran sanctions reignited those
fears, analysts said.
Because China is the world's largest commodity consumer,
accounting for about half of global copper demand, some investors
are in particular worried that a growth slowdown there could have
far-reaching consequences for the rest of the world.
"The arrest of the Chinese CFO has turned things very much
risk-off and we have a flow of negative sentiment again in metals,
even though the fundamentals are pretty positive," said Robin Bhar,
head of metals research at Société Générale.
Some analysts expect a dearth of investment in new supply to
eventually lift metals prices on a longer time horizon, though
trade fears largely continue to dictate trading.
Among other base metals, aluminum for delivery in three months
fell 1.7% to $1,936 a metric ton on the London Metal Exchange. Zinc
dropped 1% to $2,593, tin dipped 1.3% to $18,925, nickel slumped
3.3% to $10,850 and lead closed up less than 0.1% at $1,984.
In precious metals, most-active Comex gold futures for February
delivery edged up 0.1% to $1,243.60 a troy ounce with the dollar
also little changed. Silver fell 0.5% to $14.509, platinum dropped
1.5% to $789.60 and palladium slumped 3.6% to $1,141.90.
Write to David Hodari at David.Hodari@dowjones.com and Amrith
Ramkumar at amrith.ramkumar@wsj.com
(END) Dow Jones Newswires
December 06, 2018 14:03 ET (19:03 GMT)
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