Copper down to fresh six-year low after China market falls
Copper prices hit Tuesday a fresh six-year low, sliding below the psychological $5,000 a tonne level, as China’s equity market posted a steep fall.
The red metal dropped to $5,012 on trading on the London Metal Exchange, approaching the level of $5,000 it last hit in late 2008, triggered mainly by worries about weak demand from top consumer China, responsible for about 45% of the global demand for the metal.
The fall came despite data showing that Chinese home prices rose for the third consecutive month in July. However, trade in July was down 8.3% year-over-year, while the Caixin China manufacturing purchasing managers index, a measure of factory activity across the country, fell to a two-year low.
The Shanghai Composite index fell over 6% on Tuesday, their biggest fall in three weeks, on speculation the central bank may be in no rush to ease policy further, Reuters report.
The last time copper prices were this low was at the end of 2008, when a global financial crisis began escalating. Metal-depending economies from Chile to Zambia are already feeling the impact, while the world’s largest copper miners see their share price shrink.