LME copper slid for a second session on Tuesday as an intensifying trade dispute between the United States and China raised concerns over demand for industrial metals.

Fundamentals

Three-month copper on the London Metal Exchange was down 0.3 per cent at $5,892 a tonne, as of 0141 GMT, while the most-traded copper contract on the Shanghai Futures Exchange added 0.1 per cent to 47,710 yuan ($6,945.09) a tonne.

China will respond if the United States takes any new steps on trade, the foreign ministry had said on Monday, after US President Donald Trump warned he was ready to slap tariffs on virtually all Chinese imports into the United States.

Trump had said on Friday he was ready to levy additional taxes on practically all Chinese imports, threatening duties on $267 billion of goods over and above the planned tariffs on $200 billion of Chinese products.

China copper demand

Wood Mackenzie estimates the expansion of the tariff list could raise the impact to around 1 per cent of total Chinese copper demand, as many copper intensive goods are included in the extended list.

China is the world's largest consumer of copper, accounting for nearly half of global demand estimated at about 24 million tonnes this year. China's copper imports fell 6.7 per cent from a month ago to 420,000 tonnes in August, data showed.

Home prices and property investment in China are expected to rise more this year than first thought, as tight controls in big cities continue to push buyers into less-regulated smaller markets, a Reuters poll showed.

The pick-up could offer much-needed support to China's slowing economy as the United States ratchets up tariffs on Chinese goods, though policy makers are likely to remain keenly aware of the risk of property bubbles.

Asian shares were struggling to snap an eight-session losing streak on Tuesday as investors decided no news was good news on tariffs, while the pound touched a five-week top on hints a Brexit deal might be nearer.

Related Topics
comment COMMENT NOW