SHANGHAI, Aug. 2 (SMM) –The U.S. Democratic and Republican party leaders overnight finally reached a debt deal to avoid default, sending the US dollar index up to 74.52 from a low level of 73.58. Meanwhile, the US also announced the ISM manufacturing index for July slid from June's 55.3 to 50.9, the lowest since July 2009, which caused US stock markets to close down for 7 consecutive days, with the Dow Jones Industrial Average down below 12,000 points. Besides, global manufacturing PMI index was below market expectations, again proving a slowdown in global economy, and triggering market worries over dimmed copper demand prospects. In response, and coupled with sell-off pressures, LME copper prices fell below USD 9,700/mt, declining as low as USD 9,625/mt. Finally, LME copper prices closed at USD 9,685/mt, down USD 155/mt.
The US dollar index and the euro are expected to fluctuate narrowly today. As crude oil prices and copper prices on the Comex all tended to rally in this morning, LME copper prices will pare yesterday's losses slightly, but the resistance at three daily moving averages will limit the upward room. In this context, LME copper prices are expected between USD 9,660-9,760/mt during today's Asian trading hours. In domestic market, domestic stock markets closed slightly higher on the previous trading day, with contracting trading volumes, so SHFE copper prices will open more than RMB 1,000/mt lower today after LME copper prices decline significantly, and find new resistance at RMB 72,500/mt, with weaker price gains expected than those for LME copper. SHFE 1110 copper contract prices will move between RMB 71,900-72,600/mt.