FOLLOW MARKETMOVES

Copper Comment 20th Jan 2011

March copper futures traded at $4.334 per pound on Thursday, down from Wednesday’s high of $4.6675.

The World Bureau of Metal Statistics on Wednesday reported a deficit in global copper supplies for the first 11 months of 2010. That compares to a surplus of 276,000 for the same period in 2009, however arguably this was during the fallout of the global financial crisis, when demand sharply slumped. The price of copper has accelerated to new highs on anticipation that demand from China will lead to further shortfalls in global supply. However, China’s robust economic growth is becoming its own curse, as investors interpret stronger growth as a signal that officials will need to apply the economic breaks to prevent overheating. This led to a further pull-back in copper prices on Thursday, after China reported GDP growth of 9.8% in the fourth quarter of 2010. While risk sentiment does play a part in short-term movements in copper prices, ultimately the metal is a play on growth, as it is used extensively in construction and electrical goods.

Europe’s biggest copper smelter, Aurubis, foresees heightened copper demand from China as they push to upgrade the rural power grid. Therefore if China continues to expand near its current pace, and the US recovery begins to take hold, then the price of copper will rise further, on expectations of stronger global demand. Investors should be wary, however, as copper is a very volatile commodity. Sharp pull-backs in the price are not uncommon in response to adverse economic data. Policy tightening in China can trigger a sell-off, in addition to general risk appetite waning in the marketplace. These pull-backs may present a good buying opportunity for copper, as prices tend to recover quickly and resume their general trend higher. Based on copper seasonality, prices may continue to rise steadily until the second quarter, before facing a correction heading into summer.

comments powered by Disqus

All Commodities News

Trusted Firms

All Reviews
EUR/USD update (16th April 2014, 14:00) 16 Apr 2014

The euro is higher versus the US dollar, after the level of inflation in the eurozone remained unchanged in March.

GBP/USD update (16th April 2014, 13:00) 16 Apr 2014

UK unemployment has now dipped below 7%, the initial threshold level the Bank of England introduced in August but reneged upon last month, which has s...

EUR/USD update (15th April 2014, 15:00) 15 Apr 2014

Having popped its head above the $1.39 level at the tail end of last week, EUR/USD has found itself pulled back.

Market Comment 15th April 2014 15 Apr 2014

European equities are set to open flat as they’re caught between two competing poles of sentiment. 

AUD/USD update (14th April 2014, 18:00) 14 Apr 2014

The Australian dollar is gaining ground against the US dollar, as traders prepare for the latest minutes release from the Reserve Bank of Australia.

EUR/USD update (14th April 2014, 16:00) 14 Apr 2014

The euro is under pressure against the US dollar as tensions in eastern Ukraine weigh on the currency.

Market Comment 14th April 2014 14 Apr 2014

European equities are set to start on the back foot as last week’s negative sentiment remains firmly intact. 

GBP/USD update (11th April 2014, 16:00) 11 Apr 2014

After touching $1.68 yesterday, sterling has dropped back, hit by weaker UK construction output figures.

EUR/USD update (11th April 2014, 16:00) 11 Apr 2014

If we see the euro close above $1.39 today, then it will be the icing on the cake for the currency, which has enjoyed a remarkable week.

Market Comment 11th April 2014 11 Apr 2014

European equities are set to open lower tracking overnight declines in the US. 

EUR/USD update (10th April 2014, 12:00) 10 Apr 2014

Momentum has taken EUR/USD higher as a steady flow of economic data has been released over the week.

Market Comment 10th April 2014 10 Apr 2014

European equities are set to show modest gains on the open due to a dovish FOMC Meeting minutes overnight. 

AUD/USD update (9th April 2014, 19:00) 9 Apr 2014

The Australian dollar has reached a new high for 2014 prior to tonight's Federal Reserve minutes release.

EUR/USD update (9th April 2014, 18:00) 9 Apr 2014

The EUR/USD has pulled back from the $1.38 mark as traders have taken their profits from two days of gains.

Market Comment 9th April 2014 9 Apr 2014

European equities are set to open mixed as traders continue to tread cautiously. 

GBP/USD update (8th April 2014, 14:00) 8 Apr 2014

Today’s strong UK manufacturing and industrial production data has helped sterling gain ground against the US dollar.



Share this with your friends

To:
From:
Your comments:

Copper Comment 20th Jan 2011

March copper futures traded at $4.334 per pound on Thursday, down from Wednesday’s high of $4.6675.

Read more »

Connect to successful traders – join Marketmoves.com free now

Log In or Sign up

Facebook User?

You can use your facebook account to sign up with Live streaming sport.

Connect with facebook
Remember me.
Did you forget your password?