The 2011 price of copper has been severly influcenced by several factors, such as unfavourable economic data from the US, concerns over China's monetary tightening, and the financial stability of the Eurozone.
Monday marked coppers sixth straight daily loss, and its longest losing streak in since June, after Standard & Poor’s put a “negative” outlook on the AAA credit rating for the United States, the world’s largest economy and the second-largest consumer of the metal.
Growing stockpiles of copper held by China to back investments has copper market participants concerned that the country may flood the market with copper and send the price on a steep correction.
The second quarter is China’s peak demand period- it is usually during this time that the world’s top copper consumer stocks up on supplies from the copper market. However, a premium of London vs. Shanghai copper prices has some analysts wondering if China will wait before coming to market.
Copper plummeted the most in three months, Tuesday, over concern that surging oil costs would stall economic growth and dampen demand for the industrial red metal.
Copper climbed to a slightly higher finish Tuesday, recovering from its early day losses due to China’s surprise interest rate hike.
Copper surged to a new record on Tuesday, snapping its recent losing streak as investors poured funds into the red metal on expectations of seasonal strength in china
Copper future rallied on mounting concerns that demand will outpace global supplies by as much as 600,000 tonnes in 2011.
Overnight, copper futures on the Shanghai Futures Exchange rose modestly in what was a very quiet trading session, taking cues from the London Metal Exchange and the firming of the euro against the dollar.
Copper futures hit record territory in London Tuesday, buoyed by positive manufacturing data from around the world. Tuesday’s new high was the fifth time in the past seven trading sessions that copper hit a record.
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