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By Brijesh Patel
Nov 21 (Reuters) – Industrial metal prices slipped on Monday as fresh COVID-19 curbs in top consumer China clouded the demand outlook, while a stronger dollar added to the downbeat mood.
The most-traded December copper contract on the Shanghai Futures Exchange SCFcv1 dipped 1.5% to 64,880 yuan ($9,065.25) a tonne by the midday break.
“It is just the demand destruction story again, so less consumer spending, more gloomy outlook,” a Singapore-based metals trader said, adding COVID deaths in China were leading to speculation that more restrictions will come into place.
In the long term copper will stay supported and run higher on signs of easing of restrictions and stimulus, and due to lower inventories, the trader added.
Beijing’s most populous district urged residents to stay at home on Monday, while the capital reported an increase in COVID-19 cases and two deaths.Local authorities in the Baiyun District of the southern Chinese city of Guangzhou also locked down the area for five days as cases continued to mount.
Asian share markets turned hesitant, as investors fretted about the economic fallout from fresh COVID-19 restrictions in China. MKTS/GLOB
The dollar index =USD rose 0.4% against its rivals, making greenback-priced metals costlier for buyers holding other currencies. USD/
China kept its benchmark lending rates unchanged for a third straight month at the monthly fixing, matching market expectations.
Latest data shows copper stocks in LME warehouse MCUSTX-TOTAL have halved from May to 89,925 tonnes as of Friday.
Among other metals, LME aluminium CMAL3 fell 1.5% to $2,392.50 a tonne, lead CMPB3 was down 0.8% to $2,135 a tonne, tin CMSN3 lost 3.4% to $21,900 a tonne and zinc CMZN3 shed 1.9% to $2,972.50 a tonne.
SHFE nickel SNIcv1 declined 2% to 195,000 yuan a tonne, lead SPBcv1 eased 0.1% to 15,645 yuan a tonne, tin SSNcv1 fell 3.3% to 176,900 yuan a tonne, zinc SZNcv1 was down 1% to 24,070 yuan a tonne and aluminium SAFcv1 lost 0.9% to 18,895 yuan a tonne.
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($1 = 7.1570 Chinese yuan renminbi)
(Reporting by Brijesh Patel in Bengaluru; Editing by Rashmi Aich and Eileen Soreng)
((Brijesh.Patel1@thomsonreuters.com; Within U.S. +1 651 848 5832, Outside U.S. +91 8067493865; Reuters Messaging: Brijesh.Patel1.thomsonreuters.com@reuters.net))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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