Metals: Copper Falls as Supply Concerns Diminish
March 21 2017 - 2:47PM
Dow Jones News
By Katherine Dunn and Biman Mukherji
Copper prices fell to a one-week low Tuesday on hopes that
supply disruptions in Chile and Indonesia could be drawing to a
close.
Copper for May delivery settled down 1.8% to $2.6185 a pound on
the Comex division of the New York Mercantile Exchange, closing at
the lowest level since March 10.
Gold for April delivery settled up 1% to $1,246.50 a troy ounce
as the dollar weakened, which makes dollar-priced commodities less
expensive for holders of other currencies. The WSJ Dollar Index was
recently down 0.5% at 90.08.
Some analysts have pointed to Monday's French presidential
debate as undermining gold's appeal as a haven.
"It is possible that the weakness is due to yesterday's TV
debate in France, which flash polls suggest was won by the
EU-friendly candidate Macron," said Commerzbank in a note. "This is
likely to boost his standing as favorite in the presidential
elections."
Copper, meanwhile, pulled back as BHP Billiton Ltd., the
majority-owner of the Escondida mine in Chile, and union workers
are expected to hold talks which could lead to a settlement.
The base metal is also reacting to reports that Freeport-McMoRan
Inc's Indonesian unit has resumed production of copper concentrate
at its Grasberg mine, after a suspension of more than a month.
The potential for those supply disruptions to end outweighed the
weaker dollar and severe flooding in Peru, which may disrupt mining
operations and transport. The country is the world's second-largest
copper producer.
Copper's downward movement could represent a correction after it
rallied in recent months, partly on improving sentiment toward
demand in China and hopes that a Trump administration would invest
heavily in infrastructure. Copper is still up about 4% since the
year began.
The infrastructure spending "is unlikely to be forthcoming
either on the scale anticipated nor as quickly as is hoped,"
Commerzbank said.
Stephanie Yang contributed to this article
Write to Katherine Dunn at Katherine.Dunn@wsj.com and Biman
Mukherji at biman.mukherji@wsj.com
(END) Dow Jones Newswires
March 21, 2017 14:32 ET (18:32 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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