Houston, 18 January (Argus) — Comex Cu: Prices fall for second day
Comex copper prices fell for a second day from their highest level in more than a month, taking a cue from declining oil and US equities.
The Comex copper price for the most active contract settled at $2.6165/lb Wednesday from $2.625/lb the prior day and down from $2.69/lb last Friday, after it gained by 14¢ on the week.
Three-month London Metal Exchange (LME) copper was trading about 2.5pc lower Wednesday after settling at $5,797/metric tonne (t) on Tuesday.
West Texas Intermediate was trading more than 2.2pc lower at $51.32/bl in midday trading. Copper and crude often move in tandem as they are traded in the same baskets.
The Dow Jones Industrial 30 and the Standard & Poor’s 500 index were also trading lower.
Comex copper prices rose by 28pc through 5 December from 21 October. The rally got a boost from the surprise 8 November election victory of Republican Donald Trump on his pledges to boost infrastructure spending by $1trillion over 10 years and to lower taxes.
But the Trump rally appears to be losing steam as he prepares to take office on Friday as the 45th US president as investors and traders start to weigh the odds that campaign rhetoric will actually be crafted into policies. Concerns are also emerging over the future of free trade, rising interest rates and the effects a strengthening dollar will have on US exports, which would hurt Trump’s bid to revive US manufacturing.
“Hope for a large infrastructure boost look premature, and the risks from increased US protectionism are a significant headwind to higher global consumption levels,” Barclays Capital said in its latest note on metals.
Traders were also turning more defensive ahead of the lunar new year celebrations in east Asia, which last from 28 January-2 February in China.
Factory data came in lukewarm. Manufacturing output rose by 0.2pc in December after falling by 0.1pc the prior month, Federal Reserve data showed. The vehicle sub-component rose by 1.8pc, driving the overall gain in factory output.