• Money managers cut bullish wagers 60% on LME last week
  • Prices are near four-month low as LME inventories surge

Money managers cut their bullish copper bets to a four-month low in London last week, when stockpiles tracked by the biggest metals bourse surged the most in a decade.

Speculators held a net-long position of 9,837 contracts as of Friday, London Metal Exchange data show. That’s down 60 percent from a week earlier and the lowest since mid-February. Prices touched a four-month low of $4,483.50 a metric ton last week.

After climbing earlier this year on expectations of output cuts and improving demand in top user China, prices have since fallen amid signs that supplies are more than ample. Inventories in LME-monitored warehouses jumped 37 percent last week as metal was delivered into Asian facilities. On the Comex in New York, money managers are holding the largest bearish wager in three years.

“We are subdued if not outright bearish on the prospects for copper as strong mine performance has managed to offset better demand so far this year,” analysts at Macquarie Group Ltd. said in a report e-mailed Tuesday. More short-term declines are possible as copper is “weighed down by a sudden surge in LME stocks,” they said.

There are other signs of plentiful supplies. Copper for immediate delivery is trading at a $16.50 discount to the LME’s three-month contract, the widest contango since July 2015. Spot metal had been at a premium as recently as last week.

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