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Copper Climbs Back Above $3, Still Trades Near Three-Month Low

June 26, 2018 at 17:53 by Andrew Moran

Copper futures have climbed back above the crucial $3 threshold, but they are still trading at their lowest levels in three months. Despite the jump in prices on Tuesday, investors appear to have very little appetite for industrial metals as trade tensions between the US and China mount.

September copper futures rose $0.0055, or 0.18%, to $3.015 per pound at 17:26 GMT on Tuesday on the New York Mercantile Exchange. Copper prices have slumped to their worst levels since the end of March, and they are down nearly 10% year-to-date.

Rising trade tensions are weighing on a large portion of the commodities market, including the base metals sector. China, the world’s second-largest economy, is the biggest consumer of copper, and if the economy weakens as a result of geopolitical tensions, then it could hurt the red metal.

Copper prices did find support in news that union workers at a Chilean mine run by Codelco may disrupt output. Miners are warning that they may walk off the job if the company transforms the century-old Chuquicamata mine into an underground mine. This comes as reports suggest other copper mine stoppages across the country might occur amid tense talks between capital and labor.

The industrial metal’s gains were capped by a rallying US dollar as the greenback soared 0.47% to 94.73. A stronger buck is bad for commodities priced in dollars because it makes it more expensive for foreign investors to purchase.

Zinc prices also took a nosedive on Tuesday, falling to a 10-month low. The benchmark London Metals Exchange (LME) zinc dropped 0.4% to $2,847 a tonne.

In other metals markets, August gold futures tumbled $8.70, or 0.69%, to $1,260.10 per ounce. July silver futures slipped $0.07, or 0.45%, to $16.25 an ounce. September platinum futures were up $0.60, or 0.07%, to $869.40 per ounce. September palladium futures surged $19.40, or 2.07%, to $954.80 an ounce.

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