INSUBCONTINENT EXCLUSIVE:
By Susanne BartonCopper plunged into a bear market as concerns mount that Turkey’s financial crisis and the US-China trade spat will
stymie global economic growth.
The red metal for delivery in three months fell 4 percent to settle at $5,801 a metric ton at 5:52 p.m
Wednesday on the London Metal Exchange
That’s a more-than 20 percent drop from its high of $7,332 a ton in June, meeting the common definition of a bear market
Copper has posted four straight daily losses, dropping to the lowest in more than a year.
Losses on Wednesday were triggered by a broad
retreat in China as the yuan weakened and recent data showed the economy hit a rough patch
The metal’s losses have accelerated as investors flee to the relative safety of the dollar amid Turkey’s financial woes and as concern
grows that a U.S.-China trade spat will curb economic growth, hurting demand for raw materials.
“You had longs who were holding out ahead
of the technical $6,000-a-ton pivot who ultimately liquidated,” Tai Wong, head of base and precious metals trading at BMO Capital Markets
in New York, said by telephone
“Combine that with an unfriendly macro backdrop and a strong dollar without any apparent relief in sight, and you have a rout across the
complex."
Copper prices were also hit by easing supply concerns
and the union at the world’s biggest mine in Chile agreed to put a new wage offer to a vote by workers, potentially saving the industry
from a strike that threatened to disrupt supply at a time of shrinking stockpiles.
Comex copper also fell into a bear market on Wednesday
Futures for September delivery declined 4.5 percent to settle at $2.56 a pound in New York
That’s a more-than 20 percent drop from a close of $3.30 a pound on June 8.
The London Metal Exchange LMEX Index of six metals slid 4
percent, the most in more than three years.
