Copper rides on weaker dollar, spending hopes

LONDON — Copper rose on Monday, buoyed by dollar weakness and hopes that US President Donald J. Trump’s incoming administration would make good on a pledge to boost infrastructure spending in the world’s largest economy.

In his inauguration speech on Friday, Mr. Trump said his administration would “build new roads, and highways, and bridges, and airports, and tunnels and railways all across our wonderful nation.”

However, he did not go into specifics, and there was no mention of plans to outlay $1 trillion in spending over a 10-year period that were part of his election campaign.

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Three-month copper on the London Metal Exchange (LME) closed 0.80% higher at $5,795 a ton.

“What’s helping copper is clearly the weaker dollar, and hopes that we’ll get tax cuts, fiscal spending and infrastructure spending in the United States,” Societe Generale Analyst Robin Bhar said.

“The first 100 days of this presidency will be critical.”

The red metal used in construction has rallied 14% since the Nov. 8 election saw Mr. Trump voted into office on the back of promises to cut taxes and boost spending.

Meanwhile, the Lunar New Year holiday, starting Jan. 27, is expected to subdue metals demand this month as Chinese factories close, sometimes for two to three weeks.

Nickel ended the day up 0.20% at $9,715 a ton, recovering some lost ground on Monday after falling more than 7% last week after Indonesia lifted a longstanding export ban on bauxite and nickel ore.

However, it remains one of the worst performing base metals so far this year.

“Recent Indonesian and Filipino nickel supply news reinforce our view that nickel will be the base metals underperformer in 2017,” Citi said in a note.

Among this month’s best performing metals, LME zinc closed up 0.80% at $2,790 a ton, while battery material lead ended 2.10% higher at $2,357 a ton.

LME data shows that over half of LME lead stocks are held by a single party.

Among other industrial metals, LME aluminum ended the day up 0.20% at $1,849.50 a ton, having earlier hit its highest since May 2015 at $ 1,873, while tin closed 0.40% lower at $20,125 a ton. —