Industrial metal prices soared on Friday, led by copper which had its best day for five years as trade war fears eased.
Copper stood out, rising strongly in trading in Europe and the US as investors shrugged off previous concerns about the fallout of the Trump-China trade war on the Chinese demand for key commodities.
In London copper for delivery in three months on the London Metal Exchange (LME) rose more than 4.6% to $US6,363 a tonne to be up more than 6.5% for the week, while nickel climbed 4.7% to $US13,225 and zinc advanced 2.1% to $2,521.
It was copper’s biggest one-day advance since May 2013 and the close was the highest for nearly two months.
In the US, Comex December copper jumped by 4.3% to settle at $US2.8575 a pound on Friday.
LME nickel ended 5% higher at $US13,250 a tonne, the biggest rise since April. It was up 4.75 over the week
LME aluminium finished up 2.4% at $US2,091 a tonne, zinc rose 1.7% to $US2,496, lead ended 1.7%up at $US2,039 and tin added 0.2% to $US19,000.
Friday’s gains came in the face of a strong US dollar which usually weighs on commodity prices, pushing them lower. The greenback ended the week down 0.7% but jumped 0.4% on Friday.
The Aussie dollar rose sharply on Friday to end trading just under 73 US cents for a gain of 1.5 cents over the week.
For the week, Comex copper jumped 6.5% and prices are not back where they were in early July, but still under the highs of early June ($US7,348 a tonne).
Worries that trade barriers would curb demand for commodities had pushed industrial metals prices lower, with copper plunging 20% from a high of $US7,348 in June to a 14-month low of $US5,773 last month. Zinc prices tumbled 25% in the same time and nickel and aluminum also weakened.
But these concerns eased after Trump’s tariffs announced this week were set at lower rates than had been expected and China, the world’s largest metals consumer, revealed a further round of measures to boost its economy.
China’s Politburo revealed measures to support consumption by announcing tax cuts and plans to boost infrastructure spending. It announced a round of measures to help exporters in late July and early August.
But traders will have to confront news at the weekend that China reportedly will not send a delegation to the US this week to talk trade.
The Wall Street Journal reported that China canceled the talks with the US and will no longer send Vice-Premier Liu He to Washington this week.
A mid-level delegation from China had been due to travel to Washington to prepare the way for Liu’s trip, and that visit has been scrapped as well, according to the newspaper’s website.
China though is reportedly leaving open the possibility of holding fresh negotiations next month.
In Australia on Friday, BHP Billiton rose 5.5% to $33.58, while Rio Tinto advanced 8.7% to $79.49. South32 closed the week 4% higher at $3.90 and Fortescue Metals lifted 7.9% to $3.95 as iron ore prices in China failed to slide on those fears about the US-China trade war.
BHP shares were up another 2% in offshore markets after Friday’s 2.4% gain here while Rio shares gained 0.8% on top of Friday’s 1.78% gain in Australia.
The Metal Bulletin 62% Fe Iron Ore Index price was $US69.13 a tonne on Friday, down by just 5 cents a tonne. The Metal Bulletin 62% Fe Pilbara Blend Fines Index was $US68.16 a tonne, also down by 5 cents a tonne.
Comex gold settled lower Friday as ‘risk on’ trading resumed and industrial metal prices rose strongly.
Gold’s weakness came ahead of the US Federal Reserve meeting midweek that is expected to result in higher interest rates.
December gold gave up $US10, or 0.8%, at $US1,201.30 an ounce. 14. For the week, gold was all but flat.
Comex gold prices, based on the most-active contracts, are down more than 8% so far this year.
Comex December silver rose by 5.4 cents, or 0.4%, to $US14.359 an ounce. The contract was up 1.5% for the week.
