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Copper Gains on Strong Chinese Data, Capped by Rising Dollar

Summary:
Copper futures are rising to start the trading week, despite a strengthening US dollar and disappointing domestic economic data. The industrial metal has been one of the best-performing commodities since the market meltdown in March, driven primarily by a rebounding global economy and broader optimism. Although it has flirted with the key mark in recent weeks, can the red metal touch this level this year? If China continues to post impressive numbers, prices could hit this crucial threshold. September copper futures tacked on %excerpt%.0375, or 1.31%, to .9055 per pound at 13:57 GMT on Monday on the New York Mercantile Exchange. Copper prices recorded a tepid weekly loss of 0.25% last week, but they are still up nearly 4% year-to-date, thanks to a 25% rally over the last three months. After

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Copper futures are rising to start the trading week, despite a strengthening US dollar and disappointing domestic economic data. The industrial metal has been one of the best-performing commodities since the market meltdown in March, driven primarily by a rebounding global economy and broader optimism. Although it has flirted with the key $3 mark in recent weeks, can the red metal touch this level this year? If China continues to post impressive numbers, prices could hit this crucial threshold.

September copper futures tacked on $0.0375, or 1.31%, to $2.9055 per pound at 13:57 GMT on Monday on the New York Mercantile Exchange. Copper prices recorded a tepid weekly loss of 0.25% last week, but they are still up nearly 4% year-to-date, thanks to a 25% rally over the last three months.

After slumping to its lowest level in close to a month because of zero US and European growth, copper might have sparked another rally amid booming factory activity in the world’s biggest importer, China. On Friday, it was reported that the manufacturing purchasing managers’ index (PMI) rose to 51.1 in July, and the non-manufacturing PMI came in slightly lower at 54.2. The Caixin manufacturing PMI jumped to 52.8.

Overall, China’s manufacturing and services sectors continued to show expansion in activity in July as the world’s largest economy hits the reset button in the aftermath of the coronavirus pandemic.

In the US, manufacturing activity was less than what the market had anticipated. According to IHS Markit, the manufacturing PMI dropped to 50.9 in July, down from a preliminary estimate of 51.3. But it is still up from June’s final 49.8 reading.

In other industry news, Chile’s copper production levels declined 0.6% to 472,172 tons in June. This is the first monthly contraction since the COVID-19 public health crisis hit the world’s top copper producer.

The greenback is surging to kick off the trading week. The US Dollar Index, which gauges the buck against a basket of currencies, surged 0.62% to 93.93, from an opening of 93.46. A stronger greenback is bad for dollar-denominated commodities because it makes it more expensive for foreign investors to purchase.

In other metal markets, September gold futures fell $7.70, or 0.38%, to $1,978.20 per ounce. October silver futures added $0.029, or 0.12%, to $24.245 an ounce. September platinum futures picked up $7.50, or 0.82%, to $926.40 per ounce. September palladium futures rose $10.00, or 0.47%, to $2,155.30 per ounce.

If you have any questions and comments on the commodities today, use the form below to reply.


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Andrew Moran
I am a full-time professional writer. Prior to my self-employment, I worked as a reporter for Digital Journal covering the politics beat and The Toronto Times reporting on the city’s entertainment scene. I currently write mostly about business, marketing and finance

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