SHANGHAI, July 2 (SMM) – Yesterday, LME copper prices opened at USD 6,460/mt, and ended at USD 6,360/mt before hitting a daily high of USD 6,490/mt, and a session low of USD 6,320/mt.
On Thursday, China's official purchasing managers' index (PMI) fell to 52.1 in June from 53.9 in May, triggering market concerns over the pace and strength of the global economic recovery. Purchasing price index, one of major sub-indexes of PMI fell sharply for a second consecutive month, suggesting that China’s PPI will likely drop in June, which will reduce market expectations of inflation and higher interest rate. However, the drop in the PMI also reflected waning demand in overseas markets, as new export order index fell 2.1% in June from May levels. In addition, unfavorable external economic environment will also negatively affect China’s exports. In other news, data from the U.S. showed new jobless claims unexpectedly rose last week, raising market worries over the employment report to be released on Friday.
Hence, market shows lack of upward momentum due to a series of negative news recently. The US dollar index is now on a track of slow declines, supporting base metal prices to an extent. Coupled with relatively better market fundamentals, copper prices will not see large downward room.
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