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LME Copper Slips to 3-Week Low on Firm Dollar, Virus Scare

3 Aug 2020 8:30 am
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Mumbai (Commodities Control) – LME and Shanghai base metals were mostly lower on Monday morning. LME aluminium was flat but all other London metals were trading lower. The top performer in Shanghai was lead with a gain of 1.4%. It hit 15,880 yuan in Friday's night session, its highest since Nov. 1.

London copper slipped as much as 1.8% in early Asian trade on Monday, hitting a more than three-week low, as a slightly stronger dollar and fears over the spreading coronavirus weighed on prices even after more positive China manufacturing data.
After a rebound late last week, the dollar ticked higher, making dollar-denominated metals more expensive for holders of other currencies, but concerns about a slowing U.S. economic recovery from the pandemic capped gains.
Three-month copper on the London Metal Exchange was heading for a fourth straight session of fall, tumbling to $6,301 a tonne, its lowest since July 10. It was down 0.8% at $6,361.50, as of 0210 GMT.
The most-traded September copper contract on the Shanghai Futures Exchange fell as much as 2.8% to 50,210 yuan ($7,199.60) a tonne, also its lowest since July 10.
Chile's copper output fell in June for the first time since the coronavirus pandemic landed in the world's top producer of the red metal, dropping 0.6% to 472,172 tonnes.
China's July factory activity expanded at the fastest pace in nearly a decade as domestic demand continued to improve, although export orders and employment remained weak, a private survey showed.
Nonferrous metals prices on the LME were mixed on Friday July 31. Copper declined 1.23%, aluminium fell 0.84%, nickel shed 0.33% and lead weakened 0.33%, while zinc jumped 0.87% and tin rose 0.53%.
On the SHFE, nonferrous metals, except for zinc and lead moved lower on Friday night. Copper fell 1.05%, aluminium declined 0.61%, nickel shed 0.31% and tin weakened 1.4%, while zinc surged 1.14% and lead increased 0.96%.
US dollar headed for the biggest monthly drop in a decade as a virus fueled US economy fears. The US dollar index slid as low as 92.54 in early trading on July 31, a level last seen in May 2018, before rebounding to close at 93.45.

Three-month LME copper is expected to trade between $6,300-6,360/mt today. The most-liquid SHFE 2009 copper contract is likely to move between 50,700-51,100 yuan/mt today.

(Commodities Control Bureau)

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