Copper hits one-week high on global growth hopes

LONDON — The price of copper hit a one-week high on Tuesday while other metals also gained as the dollar dipped and investors remained optimistic about global economic growth prospects, although risks of a slowdown remained, especially in top consumer China.

The dollar eased against a basket of currencies while Asian share prices held near recent highs, with Chinese stocks edging up as the ruling Communist Party moved to the final stages of its twice-a-decade congress.

“The prevailing sentiment in copper is bullish based on this synchronized global growth backdrop we’re seeing, but when you’re close to these levels the probability of a slowdown is much higher,” said Julius Baer analyst Carsten Menke. “We see an oversupplied copper market next year partly driven by a slowdown in China on the property and infrastructure side, and we have mine production coming back after this year’s strikes.”

Three- month copper on the London Metal Exchange (LME) ended 0.40% higher at $7,035 a ton, having touched a one-week high of $ 7,123. Copper prices breached $7,000 a ton last week for the first time in more than three years.

A private coal mining investor in Shanxi province is the main actor behind a dramatic increase in bullish bets in Chinese copper futures, driving a futures brokerage to a near $3 billion position that has fueled a surge in prices to four-and-a-half-year highs.

Aluminum closed up 0.80% at $2,155. China’s biggest state-run aluminum producer said consumption of the metal is set to increase by nine percent to 10% this year on the back of strong downstream demand, and to keep growing at a faster rate than the country’s gross domestic product in 2018.

Zinc added 1.50% to close at $3,177 a ton, having earlier touched a one week high of $3,197. Zinc output in China slipped 2.70% in September to 537,000 tons, highlighting worries that winter production cuts are tightening supplies.

LME nickel rose 1.10% to $ 11,995 a ton. Indonesia’s PT Aneka Tambang Tbk received a recommendation from the mining ministry for an additional 1.25 million tons of nickel ore exports over the next 12 months. A Philippine state panel on Tuesday recommended lifting the ban on open- pit mining, implemented in April by the past environment secretary and supported by President Rodrigo R. Duterte.

Among other industrial metals, lead ended down 1.20% at $2,470 while tin traded up 1% at $19,775. —