Copper steadies after rising COVID infections knock prices

PUBLISHED: Tue, 20 Jul 2021 11:18:35 GMT
Peter Hobson
Reuters
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LONDON, July 20 (Reuters) – Copper on Tuesday recovered some of its losses in the previous session, when surging coronavirus infection rates triggered a sell-off of assets like metals, equities and oil that benefit from economic growth.

Benchmark copper on the London Metal Exchange (LME) was up 0.5% at $9,265.50 a tonne by 1102 GMT after falling 2.2% on Monday.

Prices reached a record high of $10,747.50 in May.

“The situation is changed in copper, which argues for a lower trading range,” said independent analyst Robin Bhar.

“Fundamentals are weaker than a few months ago. Demand is down, China is slowing and we’re definitely seeing less tightness in supply,” he said.

MARKETS: European shares on Tuesday bounced back from their worst day of the year and oil edged higher.

But the dollar added to its gains, making metals costlier for non-U.S. buyers, and U.S. 10-year bond yields hit five-month lows amid fears that the spread of the Delta coronavirus variant could derail economic recovery.

STOCKS: On-warrant copper stocks in LME-registered warehouses rose to 212,725 tonnes, the highest since May 2020.

However, inventories in Shanghai Futures Exchange (ShFE) and Comex exchange warehouses are falling. <CU-STX-SGH> <HG-STX-COMEX>

PERU: Peru’s electoral authority named socialist Pedro Castillo president. Peru is the world’s second-largest copper-producer, and Castillo has pledged to hike taxes on miners.

VALE: Brazilian miner Vale said it was reviewing its guidance for 2021 nickel and copper output after strikes and “extraordinary climate conditions” affected production.

LEAD/ZINC: The global lead market was 32,800 tonnes oversupplied in May and the zinc market was 17,900 tonnes undersupplied, the International Lead and Zinc Study Group (ILZSG) said.

ALUMINIUM: Global primary aluminium output fell to 5.549 million tonnes in June from a revised 5.75 million tonnes in May, the International Aluminium Institute (IAI) said.

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PRICES: Aluminium was up 0.7% at $2,442 a tonne, zinc fell 0.7% to $2,957, lead rose 0.6% to $2,298.50, tin added 0.4% to $33,500 and nickel was 0.4% higher at $18,540.

(Reporting by Peter Hobson Additional reporting by Mai Nguyen Editing by Steve Orlofsky)