LME copper edges higher as stimulus hopes offset firm dollar, growth woes

London copper prices edged higher on Wednesday, as hopes of more stimulus from top metals consumer China eclipsed pressure from a stronger dollar and global growth worries.

Benchmark three-month copper CMCU3 on the London Metal Exchange (LME) was up 0.1% at $10,319 a tonne, as of 0510 GMT, after hitting a two-week peak on Tuesday.

The most-active May copper contract on the Shanghai Futures Exchange SCFcv1 ended the morning session down 0.7% at 74,620 yuan ($11,664.11).

China central bank urged financial institutions to step up support for the contact-intensive service sector and small firms affected by the COVID-19 pandemic, it said in a statement on Wednesday.

“The market keeps on looking to China for policy hints. I think policymakers are reluctant to stimulate housing sectors until COVID restrictions are in place,” said Stephen Innes, managing partner at SPI Asset Management.

“On a positive note, once those restrictions have been lifted, mainland regulators entourage banks to throw a lot of cash at the housing market.”

Suspension of operations at Las Bambas mine in Peru, which accounts for 2% of global copper supply, also stocked concerns over shortages.

Keeping a lid on prices, the dollar index =USD held firm near a two-year peak against its rivals, making greenback-denominated metals more expensive for buyers using other currencies. MKTS/GLOB

Dampening market appetite, the International Monetary Fund on Tuesday slashed its forecast for global economic growth by nearly a full percentage point, citing the Russia-Ukraine conflict.

PANDEMIC: Mainland China reported 19,927 new coronavirus cases for April 19, of which 2,761 were symptomatic and 17,166 asymptomatic.

NICKEL: Vale Indonesia’s INCO.JK nickel matte output in January-March stood at 13,827 tonnes, 9% lower than the 15,198 tonnes produced in the year-ago period.

OTHER METALS: LME aluminium CMAL3 eased 0.4% to $3,248 a tonne, zinc CMZN3 edged 0.1% lower to $4,493, lead CMPB3 fell 0.6% to $2,432, while tin CMSN3 gained 0.4% to $43,250.

Shanghai aluminium SAFcv1 slipped 1.2%, nickel SNIcv1 dipped 1.1%, lead SPBcv1 also down 1.1%, while tin SSNcv1 eased 0.1%.

MARKETS NEWS

Oil and stock markets were under pressure on Wednesday on worries about the fallout from China’s pandemic lockdowns.
Source: Reuters (Reporting by Brijesh Patel in Bengaluru; Editing by Sherry Jacob-Phillips and Rashmi Aich)