Copper wilts as trade war angst spurs fresh losses for metals
SHANGHAI: Industrial metals including copper opened the week with steep losses on concern the US-China trade war is set to get much worse, with President Donald Trump prepared to hit the mainland with another round of levies, damping prospects for demand in the world’s largest consumer.
Nickel lead the retreat, tumbling as much as 3.2% to US$12,250 a tonne on London Metal Exchange before trading at US$12,350 at 9:57 am in Shanghai. Copper declined 1.4% to US$5,892.50, while aluminum sank 1.2%.
In Shanghai, contracts were mostly lower, with zinc down 1.7%.
Metals have been under pressure for months as the US-led trade war fans concern that the showdown will slow growth and sap consumption, while boosting the dollar.
President Trump instructed aides to proceed with tariffs on an additional US$200bil in Chinese products despite his Treasury Secretary’s attempt to restart talks, people familiar with the matter said last Friday.
That may prompt Beijing to decline the offer of negotiations, the Wall Street Journal said.
Chinese investors are “panicking” on the trade war news, according to Wang Yue, an analyst at Shanghai East Asia Futures Co.
That’s adding to concerns about the outlook for demand in China following bearish data last week, said Wang, referring to figures on investment in fixed assets and infrastructure.
The US public comment period for the tariffs on US$200bil in Chinese goods has closed, and any new round would be in addition to levies on US$50bil in goods already in place.
Last week, Goldman Sachs Group Inc said it saw scope for further losses in metals, despite its view that they are already oversold. — Bloomberg