Trump's tariff policy triggers risk-aversion sentiment, with copper prices under dual pressure from inventory growth and off-season [SMM Morning Comment on Copper]

       SMM News on July 8: Overnight, LME copper opened at $9,807/mt. After jumping initially and then pulling back, the center of copper prices gradually moved up, touching a high of $9,839/mt. Subsequently, it fluctuated downward and closed at $9,784/mt at the end of the session, down 0.69%. Trading volume reached 11,000 lots, and open interest stood at 281,000 lots. Overnight, the most-traded SHFE copper 2508 contract opened at 79,370 yuan/mt. It dipped to 79,300 yuan/mt at the beginning of the session, then fluctuated upward in a single direction, approaching the end of the session and touching a high of 79,550 yuan/mt. It finally closed at 79,390 yuan/mt, down 0.15%. Trading volume reached 17,000 lots, and open interest stood at 204,000 lots. On the macro side, the Trump administration issued a notice of tariff escalation to 14 countries, planning to impose a 25% benchmark tariff on imported goods from Japan and South Korea starting August 1, and a 25%-40% tariff rate on countries such as Malaysia and Indonesia. It also imposed an additional 10% tariff on countries that are part of the BRICS alliance with anti-US policies, while extending the suspension period of reciprocal tariffs until the effective date. The uncertainty of this policy has heightened market risk-aversion sentiment, exerting downward pressure on copper prices. Fundamentals show that as of July 7, SMM's nationwide copper inventories in major regions increased by 11,100 mt MoM to 142,900 mt, with inventories generally rising across all regions. The combined effect of increased imported copper and weakened end-use consumption has driven up inventory levels. Overall, the resonance between macro policy disruptions and fundamental inventory increases, coupled with the impact of the traditional consumption off-season, has exerted downward pressure on copper prices in the short term.