Comex copper drops despite improved Chinese data

Comex copper prices failed to receive a lift in the morning of October 19 in the USA, despite strong Chinese growth data, continuing the red metal’s three-day losing streak.

Copper for December delivery on the Comex division of the New York Mercantile Exchange fell 2.50 cents or 0.8% to $3.1530 per lb.

“Today’s Chinese economic figures have lent no buoyancy to prices, at least in early trading,” Commerzbank said in a daily note.

On Monday prices surged to an August 2014 high on expectations of strong Chinese data, but the complex appears overstretched at the moment especially with US demand remaining weak.

“Copper has rallied strongly across the past week. But while we believe the fundamentals remain supportive in view of the scale of gains made, prices have run some way ahead of those fundamentals,” Metal Bulletin analyst James Moore said.

Comex gold for December settlement rose $4.10 or 0.3% to $1,287.10 per oz.

Currency move and data releases

  • The dollar index was down 0.19% to 93.24.
  • In other commodities, the Texas light sweet crude oil spot price declined 1.63% to $51.41 per barrel.
  • In data today, China reported a third-quarter gross domestic product (GDP) growth of 6.8% from last year, on par with the forecast reading but below the previous prediction of 6.9%. There had been expectations in the market that the world’s largest base metals consumer would see growth of around 7% from a year earlier.
  • Chinese industrial production surprised to the upside with an increase of 6.6% against an expected reading of 6.4% and a previous reading of 6%.
  • China’s fixed asset investment missed with a reading of 7.5%, where 7.7% had been expected. This was also lower than the previous prediction of 7.8%.
  • Staying with China, Chinese President Xi Jinping gave his opening speech at the 19th Communist Party Congress on October 18, saying China was working toward “socialist modernisation” and that, “It is time for [China] to take centre stage in the world and to make a greater contribution to humankind.”
  • Here in the US, weekly unemployment claims stood at 222,000, below the forecast of 245,000. While the Philly Fed manufacturing index in October was 27.9, besting the previous figure of 23.8.