By David Hodari and Amrith Ramkumar
Copper slumped alongside stocks, oil and other risk assets Thursday as fresh worries about a slowing global economy roiled markets.
Copper for March delivery, the most-active contact, fell 1.1% to $2.7430 a pound on the Comex division of the New York Mercantile Exchange. Fears that the tariff fight between the U.S. and China will weaken global growth and lower demand for industrial materials used in construction and manufacturing have sent prices down about 17% from their June four-year highs.
Although prices edged higher early in the week after the U.S. and China signaled progress on resolving their trade spat, some analysts are skeptical the two sides can quickly come to an agreement. The recent arrest by Canadian authorities of Huawei Technologies Co.'s chief financial officer at the request of the U.S. for alleged violations of Iran sanctions reignited those fears, analysts said.
Because China is the world's largest commodity consumer, accounting for about half of global copper demand, some investors are in particular worried that a growth slowdown there could have far-reaching consequences for the rest of the world.
"The arrest of the Chinese CFO has turned things very much risk-off and we have a flow of negative sentiment again in metals, even though the fundamentals are pretty positive," said Robin Bhar, head of metals research at Société Générale.
Some analysts expect a dearth of investment in new supply to eventually lift metals prices on a longer time horizon, though trade fears largely continue to dictate trading.
Among other base metals, aluminum for delivery in three months fell 1.7% to $1,936 a metric ton on the London Metal Exchange. Zinc dropped 1% to $2,593, tin dipped 1.3% to $18,925, nickel slumped 3.3% to $10,850 and lead closed up less than 0.1% at $1,984.
In precious metals, most-active Comex gold futures for February delivery edged up 0.1% to $1,243.60 a troy ounce with the dollar also little changed. Silver fell 0.5% to $14.509, platinum dropped 1.5% to $789.60 and palladium slumped 3.6% to $1,141.90.
Write to David Hodari at David.Hodari@dowjones.com and Amrith Ramkumar at email@example.com
(END) Dow Jones Newswires
December 06, 2018 14:03 ET (19:03 GMT)
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