New York, June 28 news: Copper futures on the Chicago Mercantile Exchange (COMEX) fell on Wednesday, hitting their lowest point this month. The profit of Chinese industrial enterprises continued to decline, and the dollar exchange rate rose under the support of the prospect of the Fed raising interest rates, which put pressure on copper futures.
As of the close, copper futures fell by 3.95 cents to 6.1 cents. Among them, the most actively traded September 2023 copper futures fell 4.6 cents or 1.21% to close at 3.7425 US dollars per pound. The lowest closing price since 1 day.
July copper traded in a range of $3.718 to $3.80.
Profits at Chinese industrial companies extended their double-digit decline in the first five months of this year, data showed on Wednesday, as weak demand squeezed corporate profit margins.
A rise in the U.S. dollar on Wednesday was bearish for dollar-quoted metals, as it meant dollar-quoted copper was more expensive for buyers holding other currencies. ICE's September U.S. dollar index was at 102.548 points, up 0.41% from Tuesday. That’s despite the fact that the U.S. dollar index is still down 1.25% for the month.
The recent contract of COMEX copper futures has risen 2.46% so far this month, but copper futures have fallen 2.23% so far this year. Wednesday's closing price fell 1.55% from the same period last year, and was 24.52% lower than the historical peak of $4.929 hit in March 2022. Because of weak demand in the United States and Europe, interest rate hikes by major central banks have put pressure on economic growth; China's economic performance this year has been weaker than previously expected, and the rebound in metal demand expected by the market at the beginning of the year is hard to find.
Looking at the monthly chart, copper futures fell 6.18% in May, marking the largest monthly drop since June 2022 and the second consecutive month of decline. During April and May, copper futures fell by 11.54%.
Copper futures on COMEX fell by 14.6% in 2022, mainly because the outlook for global economic growth is worrisome. High inflation prompted European and American central banks to actively raise interest rates to curb inflation, exacerbating the risk of economic recession. In contrast, copper has recorded two consecutive years of gains of 25% in 2020 and 2021, as the green transition of the global economy and electrification help boost additional demand for the metal, which is widely used in the power and construction industries, while copper mines face challenges. Disruptions such as underinvestment and production disruptions.
The most actively traded August 2023 copper contract on the Shanghai Futures Exchange closed down 420 yuan at 67,770 yuan a tonne on Wednesday. Bonded copper futures for September 2023 on the Shanghai International Energy Exchange (INE) fell 400 yuan to 60,290 yuan a tonne.
On Wednesday, the trading volume of COMEX copper futures was 87,448 lots, compared with 88,139 lots in the previous trading day; the open volume was 194,048 lots, compared with 197,393 lots in the previous trading day
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