Copper surges in biggest one-day gain since 2013

LONDON — Copper notched its biggest one-day advance since May 2013 as investors calculated that a trade dispute between the United States and China could damage economic growth less than feared.

Benchmark copper on the London Metal Exchange (LME) closed on Friday at $6,363 a ton, up 4.6%, after touching its highest since July. It was up 6.5% on the week.

Worries that trade barriers would curb demand for commodities had pushed industrial metals sharply lower, with copper plunging from a high of $7,348 in June to a 14-month low of $5,773 last month.

But these concerns eased after tariffs announced this week were set at lower rates than had been expected and China, the world’s largest metals consumer, announced steps to boost its economy.

“There’s been quite a change in sentiment,” said Saxo Bank analyst Ole Hansen.

But copper would have to move above Fibonacci technical resistance at $6,375 a ton to cement its rally, he added.

Revived appetite for riskier assets rippled through markets, with global shares hitting sixmonth highs and Chinese stocks also climbing.

The US currency, which has been viewed as a safe haven during the trade dispute, was weaker for a second week, supporting dollar-priced metals by making them cheaper for buyers with other currencies.

Signaling a tightening market, stocks of copper in LME-registered warehouses at 216,600 tons are down from nearly 400,000 tons in March.

Inventories in Shanghai Futures Exchange (ShFE) warehouses fell 17.5% to 111,029 tons in the week to Friday.

The global refined copper market showed a 45,000 ton deficit in June after a 50,000 tons deficit in May, the International Copper Study Group said.

Cash copper on the LME flipped from a discount to a premium of $16.50 over the three-month contact, suggesting less availability of nearby metal.

LME nickel ended five percent higher at $13,250 a ton, the biggest rise since April. It was at three-week highs and up 4.7% on the week.

Stockpiles are falling in LME and ShFE warehouses and a global market deficit widened in July, the International Nickel Study Group said.

Among other industrial metals, LME aluminum finished up 2.4% at $2,091 a ton, zinc rose 1.7% to $2,496, lead ended 1.7% up at $2,039 and tin finished 0.2% higher at $19,000. —