January 30, 2017 / 11:06 AM / 3 years ago

METALS-Copper retreats as optimism fades over Trump's growth policies

* U.S. and European stocks slide more than 1 pct

* Shanghai trading closed for Lunar New Year holiday

* Speculators add to copper position -CFTC

* GRAPHIC-2017 asset returns: tmsnrt.rs/2jvdmXl (Updates with closing prices)

By Jan Harvey

LONDON, Jan 30 (Reuters) - Copper fell more than 1 percent on Monday, retreating further from last week’s two-month high as optimism over U.S. President Donald Trump’s capacity to drive economic growth faded and the dollar strengthened.

Wall Street and European stocks also fell more than 1 percent as immigration curbs put the spotlight back on the risks of Trump’s protectionist bent, spooking investors.

Three-month copper on the London Metal Exchange closed 1.4 percent down at $5,820 a tonne. Prices hit $5,981.50 on Thursday, the highest since Nov. 28.

“For the moment, this growth euphoria that kicked in after the U.S. elections has gone,” Julius Baer analyst Carsten Menke said.

For aluminium and copper, supply risks have moved back into focus, he added, though a lot of good news is already priced in.

“If we didn’t have this supply news going on, we think prices would have come down rather quickly,” he said.

Moves in metals were muted in Asian trade as China’s week-long Lunar New Year holiday drained the markets of liquidity and direction.

In supply news, Indonesia’s mining minister said the country may issue a temporary mining permit to the local unit of Freeport McMoRan Inc, paving the way for the mining giant to resume exports of copper concentrate from its Grasberg mine in Papua.

Hedge funds and money managers added to their net long positions in copper futures and options in the week to Jan. 24, data from the U.S. Commodity Futures Trading Commission showed.

LME nickel ended the day up 2.1 percent at $9,670 a tonne, rebounding from the $9,350 touched on Thursday, which was its lowest in nearly six months. It is still down 3 percent so far this year after Indonesia eased a ban on bauxite and nickel ore exports.

LME lead, the best-performing base metal this year, finished with a 2.3 percent gain at $2,342 a tonne, while zinc advanced 0.5 percent to $2,777.

Aluminium ended 0.8 percent lower at $1,802, while tin closed with a 1.3 percent decline at $19,675.

“The LME’s tin stocks have soared by 55 percent to 5,805 tons since the beginning of the year and have even doubled compared with their late-October 12-1/2-year low,” Commerzbank said in a note.

“What is more, only 4 percent of the LME’s tin stocks are currently earmarked for shipment, which points to subdued demand at present.”


Three month LME copper

Most active ShFE copper

Three month LME aluminium

Most active ShFE aluminium

Three month LME zinc

Most active ShFE zinc

Three month LME lead

Most active ShFE lead

Three month LME nickel

Most active ShFE nickel

Three month LME tin

Most active ShFE tin

Additional reporting by Melanie Burton in Melbourne; Editing by Adrian Croft and David Goodman

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