Industrial metals slip as partial lockdowns in China bite
Copper and other industrial metals fell on Friday, as renewed COVID-19 restrictions in top consumer China rekindled demand worries, while a slight pullback in the U.S. dollar limited losses.
Three-month copper on the London Metal Exchange was down 0.3% at $9,590 a tonne, as of 0705 GMT, after dropping 1.2% in the previous session. Still, the contract has gained nearly 1% so far this week.
The most-traded July copper contract in Shanghai ended daytime trading down 0.3% at 72,650 yuan ($10,870.22) a tonne.
LME aluminium was down 0.8% at $2,739 a tonne, zinc eased 0.1% to $3,757, nickel lost 1.5% to $27,600, lead fell 0.8% to $2,180, and tin slipped 0.6% to $36,515.
Shanghai and Beijing went back on fresh COVID-19 alert on Thursday after parts of China’s largest economic hub imposed new lockdown restrictions and the city announced a round of mass testing for millions of residents.
“This latest setback raises questions about whether the reopening will be as smooth as hoped, thus putting at risk the pickup in economic activity across the entire country,” ANZ analysts said in a note.
Risky assets also fell as the European Central Bank’s rate-hike outlook unnerved investors amid heightened concerns about global slowdown. [MKTS/GLOB]
DOLLAR: The dollar eased from a three-week high against its rivals, making greenback-denominated metals less expensive for buyers using other currencies. [USD/]
POLL: The U.S. Federal Reserve will hike its key interest rate by 50 basis points in June and July, according to a Reuters poll, with rising chances of a similar move in September.
DATA: China’s factory-gate inflation cooled in May, official data showed, depressed by weak demand for steel, aluminium and other key industrial commodities due to tight COVID-19 curbs.
NICKEL: Brazilian miner Vale SA said on Thursday it had completed studies for potentially developing a nickel sulfate operation in Quebec, Canada, with annual capacity seen at 25,000 tonnes.
COPPER: A group of indigenous Peruvian communities on Thursday agreed to temporarily lift a protest against MMG Ltd’s Las Bambas copper mine that forced the company to halt operations for more than 50 days.
PRICES: Shanghai aluminium fell 1.3%, zinc was down 1.4%, nickel lost 1.1%, lead fell 1.3%, and tin eased 0.2%.
Source: Reuters (Reporting by Brijesh Patel in Bengaluru; editing by Subhranshu Sahu and Jason Neely)