SINGAPORE: London copper prices snapped a five-session winning streak on Tuesday as investors practiced caution amid mounting trade friction between the United States and China.
While both U.S. President Donald Trump and Chinese President Xi Jinping expressed optimism about resolving their trade war ahead of a planned meeting at the G20 conference in Argentina at the end of next week, relations have since faltered again.
Leaders attending the Asia Pacific Economic Cooperation summit at the weekend in Papua New Guinea failed to agree to a joint communique for the first time in history, amid deep divisions between Washington and Beijing.
“The trade tensions have risen again over the weekend, but base metals have held up and I think that’s the consequence of the market taking a bit more of what fundamentals are suggesting,” said ANZ’s senior commodity strategist Daniel Hynes.
A major Asia-Pacific summit’s failure to agree on a communique was down to certain countries “excusing” protectionism and trying to force their views on others, a senior Chinese diplomat said on Monday.
“I don’t think it (the upside) is sustainable. There’ll definitely be an overhang from those trade tensions restricting the upside in base metals until there’s a little bit more clarity around a potential trade deal,” Hynes said.
COPPER: Three-month copper on the London Metal Exchange was down 0.5 percent at $6,225 a tonne, as of 0723 GMT.
The most-traded copper contract on the Shanghai Futures Exchange ended down 0.2 percent at 49,580 yuan ($7,143.89) a tonne.
Most other base metals on the Shanghai exchange fell, while London aluminium, nickel and zinc edged up.