Copper steadies after sharp selloff as dollar and oil strength weigh
CPER•Copper edged down 0.1% to $14,394 per metric ton after losing 1.4% on Monday, as a strong dollar, elevated oil prices and concerns about Chinese demand weighed on sentiment.
1. Copper prices steady
Benchmark three-month copper on the London Metal Exchange slipped 0.1% to $14,394 per metric ton by 0915 GMT on Tuesday, after falling 1.4% in the previous session to its lowest since September 17. Panmure Liberum analyst Tom Price said oil above $100 a barrel was hurting economic activity, while copper had some upside risk because inventories had been transferred into the United States.
2. Inventories and demand
LME copper stocks fell 875 tons to 251,350 tons, with around half available to the market. COMEX inventories rose for a sixth straight day to more than 700,000 tons for the first time, as the possibility of an import tariff next year remained. Traders awaited Chinese manufacturing purchasing managers’ data later in the week; Galaxy Futures analysts said restocking ahead of China’s week-long National Day holiday had largely been completed.
3. Other metals decline
The dollar index hovered near a two-month high, and markets priced in more than a 70% chance of another Federal Reserve rate increase in October. Aluminium fell 0.5%, zinc 0.1%, lead 0.2% and nickel 0.8%; tin was flat.
