DJ Copper Falls to New Six-Year Low on China Worries
By Ira Iosebashvili
Copper prices fell to a new six-year low on Wednesday, as investors remained concerned about an economic slowdown in China, the biggest consumer of the industrial metal.
Copper for December delivery, the most actively traded contract, closed down 2.9% at $2.2350 a pound on the Comex division of the New York Mercantile Exchange. It was the lowest settlement since July 2009.
The market gave up all of the gains it had made Tuesday, when the People’s Bank of China cut interest rates in an effort to boost the economy. Investors instead looked to Chinese stock markets.
The Shanghai Composite Index fell for the third day this week, ending down 1.3%. Investors remain concerned about tumbling Chinese stock markets and are trying to gauge how a sputtering Chinese economy would affect demand for copper, a metal that is heavily used in construction and manufacturing.
“The lack of confidence in China’s recent stimulus actions is very apparent as metal prices remain very much under pressure,” analysts at RBC Capital Markets said in a note to clients. “Without further and extended action from China, the rout continues.”
Prices for copper are down 19% from their June highs.
Settlements: Aug $2.2510, down 7.20 cents; Range $2.2510-$2.3020 Dec $2.2350, down 6.55 cents; Range $2.2245-$2.3025
Write to Ira Iosebashvili at firstname.lastname@example.org