Copper Futures Slip as U.S. Housing Data Signal Cooling Demandby
Construction spending fell in June, according to Census Bureau
Most other industrial metals also drop as dollar strengthens
Copper fell as other industrial metals slipped amid mounting signs that global demand is slowing.
In the U.S., the MBA mortgage applications index fell 3.5 percent last week, a third straight decline, while purchases also dropped, data from the Mortgage Bankers Association show. U.S. construction spending in June unexpectedly fell 0.6 percent, according to the Census Bureau. Construction accounts for about 30 percent of global copper demand, according to Wood Mackenzie Ltd.
Copper futures for delivery in September declined 0.5 percent to settle at $2.1985 a pound at 1:08 p.m. on the Comex in New York.
“Copper is very sensitive to the housing market,” Fain Shaffer, president of Infinity Trading Corp. in Indianapolis, said in a telephone interview. “The dollar is also starting to run and that’s also putting pressure on all industrial metals.”
The dollar rebounded from the lowest level since June as signs of overall U.S. labor-market strength fueled bets on Federal Reserve interest rate increases.
In other metals and mining news:
- Copper, zinc, lead and tin declined on the London Metal Exchange, while aluminum and nickel rose.
- Rio Tinto Group, the world’s second-biggest miner, reported its worst profit since 2004 as depressed prices for iron ore, aluminum and copper eroded earnings.
- The 98-company Bloomberg World Mining Index slipped 0.1 percent.
- LME option contracts expire because it’s the first Wednesday of the month.