Copper prices extended gains as easing US-China trade tensions and assurances over Fed leadership boosted market sentiment. Trump’s mention of “substantial” tariff cuts sparked a risk-on rally, driving speculative net longs in Copper to a record high. Meanwhile, supply concerns added support after a major Peruvian mine was shut down due to a fatal incident, ING’s commodity experts Ewa Manthey and Warren Patterson note.
Copper rally gains momentum on trade optimism
“Copper and other industrial metals continued to rise yesterday amid hopes of a de-escalation in trade tensions between the US and China. This was after President Trump floated “substantial” tariff cuts. Also, Trump claiming he has no intention of firing Federal Reserve Chair Jerome Powell added to the risk-on tone in broader financial markets.”
“On the LME, speculators increased their net long in Copper by 33,352 contracts to 98,765 contracts, according to exchange data. The net-long position was the most bullish on record going back to January 2018. As for Copper supply, the Antamina Copper-zinc mine in Peru was shut down for safety reasons following a fatal incident.”