Commodities: Copper futures plummet to fresh six-year lows

Oil markets saw another day of lacklustre trading on Tuesday, while copper futures fell to fresh six-year lows on poor economic data from China.

At 1640 GMT, the Brent front-month futures contract for December delivery was up 0.13% or 28 cents to $47.32 per barrel while the WTI was up 1.07% or 47 cents at $44.34 per barrel, with both benchmarks broadly staying in the previous session’s range, as oversupply perceptions continued to weigh on market sentiment.

Data released overnight from China suggested October’s headline inflation stood at 1.3%, below market forecasts of 1.5%, and 1.6% recorded in September, indicating a slowdown in consumer demand. Base metals felt the heat, as the three-month copper delivery futures contract was down 1.2% to $4,914.50 per metric tonne in late afternoon trading on the London Metal Exchange, trading near levels last recorded in 2009.

Additionally, primary aluminium (down 2.4%), lead (down 2.0%), nickel (down 0.9%) and zinc (down 3.9%) futures also traded lower, but tin (up 0.3%) bucked broader market trends.

Liz Grant, senior account executive at Sucden Financial, said, “LME prices came under pressure from Chinese data from the word go and continued to head south through the session. Meanwhile, the dollar maintained a steady tone which weighed on metals.”

A stronger dollar also continued to dent fragile confidence in the precious metals market. COMEX gold was broadly flat at $1,092.00 an ounce, while spot gold was 0.12% or $1.34 lower at $1,090.97 an ounce, reversing intraday gains and extending overnight declines further.

Jasper Lawler, analyst at CMC Markets, said, “Sentiment in gold has turned very bearish, which a contrarian might point as the first sign of a bottom but at the current momentum, there could even be a new six-year low this week.”

COMEX silver fell 0.26% or four cents to $14.38 an ounce, while spot platinum was 1.05% or $9.60 lower at $903.30 an ounce.

Finally, headline agricultural commodities futures were firmly in negative territory. CBOT wheat (down 1.54%), corn (down 0.68%), ICE cotton (down 0.11%) and CME Live Cattle (down 1.80%) were all trading lower.