Copper futures fell from a four-month high in New York as signs of political turmoil in Europe rekindled concerns that the region’s debt crisis will erode global economic growth and commodity demand.
Spanish bonds dropped as Premier Mariano Rajoy faces opposition calls to resign amid contested reports about illegal payments. The dollar strengthened against the euro, reducing the appeal of raw materials as alternative investments. A gauge of six industrial metals has declined 3.4 percent in the past 12 months.
“Concerns over Europe may be working to lower metal prices, especially as the dollar firms up,” Sterling Smith, a futures specialist at Citigroup Inc. in Chicago, said in a telephone interview.
Copper futures for March delivery fell 0.4 percent to close at $3.7685 a pound at 1:09 p.m. on the Comex in New York. Earlier, the price reached $3.7925, the highest for a most-active contract since Oct. 5, on signs of economic optimism in China, the world’s top user of the metal, and the U.S., the second-biggest.
Hedge funds and other large speculators reduced their copper net-long positions by 12 percent to 14,448 futures and options contracts in the week ended Jan. 29, government data show. That’s the lowest since Dec. 4.
On the London Metal Exchange, copper for delivery in three months climbed 0.2 percent to $8,305 a metric ton ($3.77 a pound). Nickel and zinc also rose, while aluminum declined. Tin and lead were unchanged.