Copper slid to the lowest level in six years as the biggest selloff in Chinese equities since 2007 added to concern that the economy will worsen.
The Shanghai Composite Index plunged 8.5 percent. China’s industrial profits fell in June, and data on Friday showed a private gauge of manufacturing unexpectedly declined in July to the lowest level in 15 months, boosting speculation that demand is slowing in the country. China accounts for about 40 percent of the world’s copper consumption.
“A rout resumption in Chinese equities prompts more scattered selling in most metals seen this morning,” Michael Turek, the head of base metals at BGC Partners Inc. in New York, said in an e-mail. “They just can’t catch a break or a breath, that is despite all the efforts to stabilize the Chinese markets up until now.”
Copper for delivery in three months lost 1.4 percent to settle at $5,188 a metric ton ($2.35 a pound) at 5:51 p.m. on the London Metal Exchange, earlier dropping to $5,164 a ton, the lowest level since July 2009.
Chinese investors banned from shorting equities may be selling copper, exacerbating the metal’s collapse. They’re seeking to hedge exposure to shares after the government stepped in to stem a stock rout, according to brokers including Guotai & Junan Futures Co. and Haitong Futures Co.
Copper futures for September delivery slid 1.2 percent to $2.3535 a pound on the Comex in New York.
On the LME, aluminum, zinc, nickel and lead also declined, while tin gained.