Copper sinks to 2-1/2-month low as risk aversion grips metals
XLB•Copper fell 2.5% to $13,981 a metric ton, after touching $13,833, its lowest since August 19. Risk aversion, concerns about AI spending, uncertainty ahead of US elections and Middle East tensions weighed on metals.
1. Copper hits low
Benchmark three-month copper on the London Metal Exchange fell 2.5% to $13,981 a metric ton by 0956 GMT, after reaching $13,833, its lowest level since August 19. ING commodities strategist Ewa Manthey said investors were pulling back from cyclical assets as technology shares came under pressure, prompting questions about near-term metals demand from AI and data-centre investment.
2. Other market factors
Investors were assessing potential implications of the US midterm elections for fiscal policy and government spending, while the US-Iran conflict clouded the growth outlook. A sharply weaker yuan made dollar-priced metals more expensive for buyers in China, but signs of tight physical supply there limited copper's losses: the Yangshan copper premium remained near $200 a ton, its highest in more than a decade.
3. Other metals fall
Copper's drop below its 100-day moving average at $14,053 reinforced bearish momentum, while initial support was seen around $13,589. Aluminium fell 1.5%, zinc 2.1%, lead 1.0%, nickel 0.9% and tin 3.8%.
