Shanghai copper drags industrial metals complex lower amid global tensions

SYDNEY — Shanghai copper futures opened higher on Monday but quickly went into negative territory as investors cut bets that Chinese demand was getting stronger and that global tensions were easing.

Copper’s shift into the red pulled the rest of the Shanghai Futures Exchange (ShFE) metals complex lower.

JITTERS

“Commodities struck a note of caution as investors continued to grapple with geopolitical risks amid mixed fundamentals,” ANZ Bank said in a note.

North Korea said on Sunday that it was ready to sink a US aircraft carrier to demonstrate its military might, in the latest sign of rising tension as US President Donald J. Trump prepared to call the leaders of China and Japan.

FUNDAMENTALS

Three-month copper on the London Metal Exchange managed a 0.07% rise to $5,662 a ton after ending last week lower.

The most- traded copper contract on the ShFE dropped 0.24% to 45,880 yuan ($6,664) a ton.

The global refined copper market had a 51,000 ton surplus in January, up from a 44,000 ton surplus in January last year, the International Copper Study Group said.

ShFE zinc, which led ShFE metals contract’s higher on Friday, recoiled more than 1% to 21,530 yuan.

Matt Chamberlain was named London Metal Exchange (LME) chief executive on Friday, with a mandate from its owner — the Hong Kong bourse — to reform the world’s largest and oldest metals market.

Is aluminum the new steel for China’s policy makers? The country’s steel producers are already being subjected to a host of measures intended to weed out excess capacity.

ShFE aluminum dropped 0.17% to 14,355 yuan ($2,085) a ton.

LME aluminum was up 0.06% to $1,944 a ton.

Copper miner Freeport-McMoRan, Inc. warned on Friday it would punish workers for absenteeism at its Indonesian unit, a day after one of its main unions announced plans to go on a one-month strike over employment conditions.

OTHER MARKET NEWS

The World Bank Group and the China-led Asian Infrastructure Investment Bank said on Sunday that they had agreed to deepen their cooperation with a framework for knowledge sharing, staff exchanges, analytical work, development financing and country-level coordination.

The euro vaulted to fivemonth peaks in choppy Asian trading on Monday after the market’s favored candidate — Emmanuel Macron — won through the first round of the French election, reducing the risk of a Brexit- like shock and sparking a mass unwinding of safe haven trades.

The euro scaled five- month highs against the dollar in early Asian trading on Monday after the centrist candidate swept to victory in the first round of the French presidential election, reducing the risk of an antiestablishment shock in the final round. —