By Amrith Ramkumar

Falling prices of industrial metals such as copper and aluminum signal that some investors remain wary of setbacks to a U.S.-China trade deal, countering the optimism that has kept stocks just below Monday's records.

Since hitting a 3 1/2 -month high Nov. 7, copper prices have fallen 3.6%, while aluminum is down 4.1% over that same span. Other base metals critical to manufacturing and construction such as nickel and lead are also falling, underscoring worries that a weaker global economy will result in lower demand for industrial commodities.

On Thursday, most-active copper futures fell 0.8% to $2.6280 a pound on the Comex division of the New York Mercantile Exchange, while aluminum for delivery in three months fell 0.2% to $1,738 a metric ton on the London Metal Exchange.

Conflicting trade reports indicating that the U.S. and China still have to make progress before reaching an initial pact to de-escalate tensions in their monthslong tariff fight have weighed on sentiment in metals markets, analysts say. At the same time, some expect industrial-metals markets to remain well supplied.

China's chief trade negotiator has invited his American counterparts for a new round of face-to-face talks, The Wall Street Journal reported Thursday.

Last month, the International Copper Study Group, a body of copper producers and consumers, lowered its target for 2019 demand growth to 0.3% from about 2% in May. The downward revision showed how much trade concerns and softening economic growth around the world have weighed on industrial-metals consumption.

Hedge funds and speculative investors still expect prices to decline despite signs of progress on trade starting in mid-October. Bearish wagers by speculators have exceeded bullish ones since mid-April, Commodity Futures Trading Commission figures through Nov. 12 show.

Elsewhere in commodities Thursday, U.S. crude-oil futures rose 1.4% to $57.82 a barrel on the New York Mercantile Exchange, extending a Wednesday rally that followed data showing a smaller-than-expected increase in domestic stockpiles during the week ended Nov. 15. Brent crude, the global gauge of prices, advanced 1.1% to $63.06 a barrel.

Natural-gas prices inched down 0.2% to $2.554 a million British thermal units as traders awaited the latest inventory figures. Record U.S. production and moderate weather have dented prices in the past year.

Write to Amrith Ramkumar at amrith.ramkumar@wsj.com

(END) Dow Jones Newswires

November 21, 2019 10:56 ET (15:56 GMT)

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