SHANGHAI, Sept. 23 (SMM) – LME copper touched a 4-week low of USD 5,036/mt during Asian trading hours on sell-offs and finally closed at USD 5,075/mt, slipping 3.41%, its largest single-day drop since July 7 this year.
Overnight, pessimistic sentiment loomed market. US dollar surged, weighing down commodity prices. Volkswagen’s emissions scandal triggered worries about demand for auto and base metals. Meanwhile, investors showed concerns over China’s Caixin manufacturing PMI number due out Wednesday.
In response to LME copper, SHFE 1511 copper gapped lower at RMB 39,310/mt during Tuesday evening session and then slid to RMB 38,250/mt, to end at RMB 38,450/mt, down by RMB 1,730/mt or 4.31%. Positions increased 12,104 and trading volumes were around 470,000 lots.
Chile announced to give cash compensation to mines after the earthquake and thus international copper prices dipped. Worries about a slowdown in China’s economy exit in market. Markets expect China’s Caixin manufacturing PMI number to be downbeat. Also, market confidence is weakened by Glencore’s sell-off on zinc. Rising US dollar also depresses copper prices.
With overall bearish sentiment, LME copper should move in USD 5,030-5,100/mt during Asian trading hours. SHFE 1511 copper suffers sell-off pressures and thus is likely to range between RMB 37,760-38,600/mt on Sept. 23. In China’s spot market, SHFE copper slumped and traders move hedged goods out. Spot copper will be offered between discounts of RMB 50/mt and premiums of RMB 20/mt.