China manufacturing data supports copper prices

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 Copper prices held largely steady on Monday as expectations for robust demand boosted by healthy manufacturing data from top consumer China was offset by a firmer dollar and as the market focused on the U.S. presidential election.

Benchmark copper on the London Metal Exchange was up 0.2% at $6,729 a tonne at 1110 GMT. Prices of the metal used in the power and construction industries are down about 4% since hitting a 28-month high above $7,000 last week.

“China dominates copper demand, economic activity is back to normal so more stimulus is unlikely. It would be difficult to justify higher prices,” said Julius Baer analyst Carsten Menke.

“The U.S. election depending on who wins could be positive for sentiment. But it consumes less than 10% of the global total, it wouldn’t move the needle in terms of demand from infrastructure investment.”

MANUFACTURING: Activity in China’s factory sector accelerated at the fastest pace in nearly a decade in October as domestic demand surged, adding momentum to an economy that is quickly recovering from the coronavirus crisis.

DOLLAR: A higher U.S. currency makes dollar-denominated metals more expensive for holders of other currencies, which could subdue demand and prices.

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