Commodities: Base metals prices dive on EM, China concerns

Base metals were especially weak, with market observers unsure whether to blame a slowdown in China's economy or the ongoing situation in Turkish assets for the drop.

All the main LME contracts were left nursing heavy losses, with zinc and lead both shedding roughly 6% each.

Three-month copper meanwhile fell from $6,039 per metric tonne mark at the start of trading to $5,801.

"Today's market activity saw weakness and a degree of panic across the financial markets as investors and traders grapple with increasing global trade tensions, concerns over China's ability to maintain its target 6.50% growth target and possible contagion and further fallout from the Turkish economic crisis," said analysts at Sucden Financial.

"The underlying strength in the USD continued to weigh on USD commodities triggering technical price break- downs in copper, lead, nickel and zinc as weaker longs were forced to abandon positions."

To take note of, news of progress in wage talks between BHP Billiton and workers at its giant Escondida mine, in Chile, was another factor weighing on the red metal.

Gold futures for December delivery on COMEX continued to slip lower alongside copper, shedding 1.28% to finish at $1,185.30/oz..

West Texas Intermediate from prompt-month delivery also got pummelled, erasing 2.86% to $65.12 a barrel on the NYMEX.

The sharpest selling ensued following the release of the US Department of Energy's crude oil inventory data for the week ending on 10 August, which revealed a 6.8m barrel build (consensus: -2.5m barrels).

As an aside, according to Reuters, which cited shipping data, in July, China and India's shipped imports were running about 0.5m barrels a day beneath their January-June average of 12.4m barrels per day.

Combined, the two Asian nations accounted for 12% of global oil purchases.

All-in-all, by 1849 BST the Bloomberg commodity index was reeling, having lost 1.82% to stand at 82.25, just off a 52-week low.