Copper Falls, Caps Biggest Weekly Drop Since June 2010 on Growth Concerns
Copper futures fell in New York, capping the biggest weekly slump since June 2010, on concern that the faltering global economy will curb demand for industrial metals.
Copper declined for the fifth straight day as a report showing U.S. employers in July added more jobs than forecast failed to ease concern that the nation will slip into another recession. All six base metals traded on the London Metal Exchange dropped, with lead and zinc falling more than 5 percent and tin had the biggest weekly drop in two years.
“Sentiment has become king, and perceptions of the macro outlook have taken a turn for the worst,” Gayle Berry, an analyst at Barclays Capital in London, said in a report. “The metals were by far the worst affected of the commodity sectors.”
Copper futures for September delivery slid 11.85 cents, or 2.8 percent, to close at $4.117 a pound at 1:24 p.m. on the Comex in New York. Earlier, the price reached $4.0795, the lowest for a most-active contract since June 28. The metal tumbled 8.1 percent this week.
The U.S. economy expanded less than economists estimated in the second quarter, and first-quarter growth was revised lower, government figures showed last week. European services and manufacturing growth eased last month to the slowest pace in almost two years, a report showed on Aug. 3.
“There is a lot of disappointing macro data coming out of the U.S.,” Angus Staines, an analyst at UBS AG in London, said in a telephone interview. “As the market changes its sentiment toward an expectation for worse data, we’ll continue to see that being priced into commodities.”
On the London Metal Exchange, copper for delivery in three months fell $314, or 3.4 percent, to $9,041 a metric ton ($4.10 a pound).
Tin fell $1,155, or 4.5 percent, to $24,350 a ton. Earlier, the metal touched $23,165, the lowest since Sept. 22. This week, the price dropped 13 percent, the most since July 2009.
Aluminum dropped $74, or 3 percent, to $2,402 a ton after reaching $2,400, the lowest since Jan. 27. The metal fell 8.5 percent this week, the most since December 2008.
Nickel, zinc and lead also declined.
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