Commodities

Copper hits 6-week high after US, China agree to restart trade talks

Reuters SINGAPORE | Updated on July 01, 2019 Published on July 01, 2019

Copper and other base metals rallied on Monday, after the United States and China agreed to restart trade talks, easing risks of severe global economic growth that hurt demand for metals.

US President Donald Trump on Saturday offered concessions, including no new tariffs and an easing of restrictions on tech company Huawei, while China agreed to make new purchases of US farm products and return to the negotiating table.

Benchmark copper in London rose 1.3 per cent to $6,701.50 a tonne by 0106 GMT, its highest since May 20, while the most-traded copper contract on the Shanghai Futures Exchange advanced 0.9 per cent to 47,420 yuan ($6,907.50) a tonne.

All other base metals rallied on the London Metal Exchange, with London nickel touching its highest since April 18, while all metals, except tin, rose in Shanghai.

“The markets hopes were realised, with Trump and Xi agreeing to resume talks. This should boost sentiment in the base metals sector, despite China's PMI for June coming in under 50 for the second month in a row,” said ANZ in a note.

China's official Purchasing Managers' Index (PMI) stood at 49.4 in June, showing factory activity shrinking more than expected in June, as US tariffs and weaker domestic demand pressured on new orders.

Fundamentals

Long road: China and the United States will face a long road before they can reach a deal to end their bitter trade war, with more fights ahead likely, Chinese state media said after the two countries' presidents held ice-breaking talks in Japan.

Chuquicamata: Chile's Codelco, the world's top copper miner, said on Friday its Chuquicamata mine was fully operational after a two-week long strike that had docked output from the sprawling deposit came to an end.

Glencore: The number of artisanal miners killed by a landslide at a copper and cobalt mine run by Glencore in Congo rose to 43 on Friday and officials said the army would deploy at the mine as the search for more victims continued.

Published on July 01, 2019
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