Copper Falls as Supply Concerns Diminish
March 21 2017 - 8:09AM
Dow Jones News
By Katherine Dunn and Biman Mukherji
LONDON--Copper prices fell to a one-week low on Tuesday on hopes
that supply disruptions in Chile and Indonesia could be drawing to
a close.
The three-month London Metal Exchange copper price fell 0.83% to
$5,827 per metric ton in midmorning European trading, the lowest
price since March 13.
Gold also fell Tuesday, by 0.12% to $1,232.36 a ton, despite a
weaker dollar, which makes dollar-priced commodities less expensive
for holders of other currencies. Some analysts pointed to Monday's
French presidential debate as undermining gold's appeal as a
haven.
"It is possible that the weakness is due to yesterday's TV
debate in France, which flash polls suggest was won by the
EU-friendly candidate Macron," said Commerzbank in a note. "This is
likely to boost his standing as favorite in the presidential
elections."
Copper, meanwhile, pulled back as BHP Billiton Ltd., the
majority-owner of the Escondida mine in Chile, and union workers
are expected to hold talks which could lead to a settlement.
The base metal is also reacting to reports that Freeport-McMoRan
Inc's Indonesian unit has resumed production of copper concentrate
at its Grasberg mine, after a suspension of more than a month.
The potential for those supply disruptions to end outweighed the
weaker dollar and severe flooding in Peru, which may disrupt mining
operations and transport. The country is the world's second-largest
copper producer.
On Tuesday, the WSJ Dollar Index, which weighs the dollar
against other currencies, was down 0.26%.
Copper's downward movement could represent a correction after it
rallied in recent months, partly on improving sentiment toward
demand in China and hopes that a Trump administration would invest
heavily in infrastructure. Copper is still up 5.77% since the year
began.
The infrastructure spending "is unlikely to be forthcoming
either on the scale anticipated nor as quickly as is hoped,"
Commerzbank said in a morning note.
Among the other industrial metals, aluminum was up 0.89% at
$1,934.50 per ton, lead was up 1.10% at $2,293.50 a ton, zinc was
up 0.61% at $2,881 per ton and tin was up 0.74% at $20,450 per ton.
Nickel was down 0.05% at $10,170 per ton.
Among precious metals, silver was down 0.17% at $17.42 per ton;
platinum was down 0.54% at $964.75 a ton; and palladium was up
0.56% at $786.85 a ton.
Write to Katherine Dunn at Katherine.Dunn@wsj.com and Biman
Mukherji at biman.mukherji@wsj.com
(END) Dow Jones Newswires
March 21, 2017 07:54 ET (11:54 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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