Copper extended losses to reach a five-month low as worries about economic growth led to another day of a broad commodities sell-off.
|||Copper extended losses to reach a five-month low as worries about economic growth led to another day of a broad commodities sell-off on Friday.
Copper for three-month delivery on the London Metal Exchange fell to $8,657 a tonne, its lowest since December.
The metal used in power and construction traded at $8,774 a tonne in rings versus Thursday's close of $8,820.
“At the minute, everything goes down across the board, and clearly the market is being fairly indiscriminate in terms of the price moves,” said Nic Brown, head of commodities research at Natixis.
“If base metals continue to go down in line with sharper falls that are taking place in the oil market, then ultimately that provides a good buying opportunity.”
Commodities spiralled lower again on Friday with crude oil down as much as $5 as concerns over a slowdown in global growth sent traders rushing for the exit.
“Ultimately if oil prices continue to correct at the speed at which they are currently going, this is good for base metals. This will help base metals in the long run,” Brown said.
“It allows countries like China and Brazil, India and Russia to take their foot off the gas. It allows them to slow the tightening of monetary policy; it allows them greater scope for growth and that should be good for base metals.”
Copper could fall to around $8,000 a tonne, Sean Corrigan, Diapason Commodities Management chief investment strategist, said on Friday.
Inventories of copper, aluminium and nickel at LME warehouses fell while stocks rose in tin and zinc, the latest data showed. Lead inventories were unchanged.
Aluminium traded at $2,615 a tonne in rings from $2,635 a tonne at the close on Thursday. Zinc, used in galvanising, traded at $2,120 a tonne from $2,125. It earlier fell to its lowest since end-November at $2,048 a tonne.
Battery material lead was at $2,260 from $2,295 a tonne. It also earlier fell to its lowest since end-November at $2,200 a tonne.
Nickel was untraded in rings but bid at $24,440 from $24,525 a tonne. Tin was also untraded in rings but bid at $28,800 from $28,900 a tonne at the close on Thursday. - Reuters
Source: http://www.iol.co.za/copper-extends-losses-1.1065470
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