SHANGHAI, Aug. 27 (SMM) – LME copper moved on the weak side during European and US trading hours and tested support at USD 4,900/mt. Finally, LME 3-month copper ended at USD 4,920/mt, down USD 136/mt or near 2.7%.
The announcement of PBOC’s interest rate and RRR cut failed to ease worries about demand in China. Chinese shares fell from high and finally closed down on Wednesday, mirroring weak confidence in market. Commodity prices were thus weighed down.
European and US stocks were mixed. US durable goods orders for July beat forecast, driving US stocks up. US dollar also rallied despite the dovish tone of the Fed’s latest meeting minutes, depressing base metals prices.
SHFE 1511 copper opened lower at RMB 38,500/mt in response to falling LME copper on Wednesday night. The contract then advanced to RMB 38,600/mt but later drifted lower to RMB 38,090/mt due to stronger dollar and sell-offs. The red metal finished down RMB 780/mt or 2.00% at RMB 38,290/mt. Positions declined 5,794 and trading volumes were about 120,000 lots.
SHFE 1511 copper is predicted to fluctuate between RMB 38,100-38,700/mt on Aug. 27 amid Chinese weak stock market and yuan depreciation. Spot copper will be offered at discounts of RMB 20-80/mt against SHFE 1509 copper.