Views Article – Sharenet Wealth

Europe, News

Copper gains on EU stimulus deal and coronavirus vaccine hopes

(Updates with prices)

By Zandi Shabalala

LONDON, July 21 (Reuters) – Copper prices climbed on investor hopes for a recovery in metals demand and the global economy after European Union leaders agreed a massive stimulus plan and positive news emerged about a coronavirus vaccine trial.

Three-month copper on the London Metal Exchange rose 0.8% to $6,541 a tonne by 1617 GMT on Tuesday, close to the 25-month high of $6,633 on July 13.

BMO Capital Markets analyst Tim Wood-Dow cited vaccine trials and the EU stimulus package for boosting sentiment and prices but said gains could be capped by the current seasonal slowdown in China.

“(Data) shows that western financial markets are already quite long on copper and so from a financial positioning standpoint, the impetus on prices may have run its course for now,” he said.

STIMULUS & VACCINE: European Union leaders agreed on a massive stimulus plan for their economies, while early data from trials of three potential coronavirus vaccines showed positive results.

U.S RELIEF FUND: Advisers to U.S. President Donald Trump and congressional Democrats were set to discuss the next steps in responding to the coronavirus crisis on Tuesday, with congressional Republicans saying they were working on a $1 trillion relief bill.

POSITIONING: Speculators upped their net long position in COMEX copper futures by 9,792 contracts to 41,309 in the week to July 14.

After touching a November 2017 high of 18.1% of open interest on Monday last week, the LME Copper net speculative long eased slightly to 15.7% on Friday, broker Marex Spectron estimates.

CHINA COPPER: Refined domestic copper prices <SMM-CU-REF> fell 2.1% to 51,375 yuan a tonne from a 25-month high hit in the previous session, the latest SMM data showed.

OTHER PRICES: LME aluminium rose 1.9% to $1,686 a tonne, zinc was up 1.9% at $2,242.50, lead rose 0.2% to $1,844, tin added 1.1% to $17,555 and nickel gained 1.1% to $13,367. (Reporting by Zandi Shabalala; additional reporting by Mai Nguyen; editing by Emelia Sithole-Matarise, David Goodman and Barbara Lewis)


© 2019 Thomson Reuters. All rights reserved. Reuters content is the intellectual property of Thomson Reuters or its third party content providers. Any copying, republication or redistribution of Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. Thomson Reuters shall not be liable for any errors or delays in content, or for any actions taken in reliance thereon. "Reuters" and the Reuters Logo are trademarks of Thomson Reuters and its affiliated companies.