METALS-Copper recovers on rising prospects of Fed rate cuts

By Kitco News / June 13, 2019 / www.kitco.com / Article Link


* GRAPHIC-2019 asset returns:
* LME copper stocks jump, ShFE stocks down (Adds closing prices)By Pratima DesaiLONDON, June 13 (Reuters) - Copper prices recovered onThursday after weak U.S. data reinforced prospects of rate cutsfrom the U.S. central bank, but worries about demand in topconsumers China and the United States cappedgains.Benchmark copper on the London Metal Exchange endedup 0.1% at $5,858 a tonne. Earlier in June, prices of the metalused by investors as a gauge of economic health touched $5,740 atonne, the lowest since Jan. 3."There was some profit-taking on short copper positions(bets on lower prices) after a batch of weak U.S. data," ametals trader said.


"The data reinforces the idea of a cut (from the U.S.Federal Reserve). But the U.S.-China trade dispute is stillthere, it hasn't been resolved."


JOBS: The number of Americans filing for unemploymentbenefits unexpectedly rose last week, adding to concerns aboutgrowth. A Fed rate cut could weaken the U.S. currency and makedollar-denominated metals cheaper for importers using othercurrencies, potentially boosting demand.DEMAND: China accounts for around half of global copperdemand, estimated at 24 million tonnes this year, while theUnited States consumes nearly 10%.TRADE: China said on Thursday it will not yield to any"maximum pressure" from Washington, and any attempt by theUnited States to force China into accepting a trade deal willfail. TARIFFS: "As long as they only talked about tariffs I wasn'toverly concerned about demand as it just makes things moreexpensive," said Julius Baer analyst Carsten Menke."But bans and boycotts like those on Huawei disrupt supplychains which will have a negative impact on demand."HUAWEI: Latest developments include a ban on federalcontracts with firms that do business with the Chinese telecomgiant, part of a defence law passed last year.INVENTORIES: Weighing on copper are stocks in LME registeredwarehouses at 248,550 tonnes, up 35% since the end of May .Traders say the market would need to see a similar uptrendin warehouses monitored by the Shanghai Futures Exchange tobelieve demand was weakening.Latest data showed copper stocks in ShFE warehouses at145,626 tonnes, down more than 40% since March 31 .CHILE: Unionised workers at Codelco's Chuquicamata coppermine, one of the world's largest, said on Wednesday they wouldstrike after failing to reach a labour deal with the world's topcopper producer. PRICES: Aluminium was 0.2% lower at $1,787, zinc lost 1.3% to $2,477, lead slipped 0.4% to$1,889.5 and tin rose 0.3% to $19,350.Nickel was untraded in the rings. In electronictrading, it was a touch higher at $11,840 a tonne compared withan earlier two-week high at $12,050.


INDONESIA: Traders had marked up nickel prices due toconcern about supplies from major producer Indonesia wherefloods have lashed Sulawesi province. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^Top Base and Precious Metals Analysis - GFMS ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Pratima Desai; editing by Kirsten Donovan andDavid Evans)


LME price overview COMEX copper futures Base metals news All metals news All commodities news Metals diary Foreign exchange rates SPEED GUIDES)) Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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