Copper’s performance on August 2
Copper started the day on a positive note by gaining in the early morning hours on August 2, but it pared gains as the day progressed. At 2:00 PM EST on August 2, the COMEX copper futures contract for September delivery was trading at $2.21 per pound—a gain of ~0.39%.
Weakness in the dollar prices supported copper prices. Read Copper, Gold, and Silver Are Stable in the Early Morning on August 2 to learn more about copper’s performance in the early morning hours on August 2.
Copper rose and pared gains
Copper rose to $2.24 per pound in the morning session as the dollar weakened but reversed its rally. Even though the weaker dollar supports the dollar-denominated commodities like copper, weakness in crude oil along with mixed sentiment in the copper market capped the gains.
At the beginning of the week, the Chinese manufacturing PMI (purchasing managers’ index) data were released. The divergence between the official PMI data and Caixin manufacturing PMI data was observed. According to the data, the official Chinese manufacturing PMI for July was 49.9—below the market’s expectation of 50. It indicates a contraction in the manufacturing activity. On the other hand, the Caixin manufacturing PMI released by Markit for July was 50.6—the first expansion since February 2016.
At 2:15 PM EST on August 2, major copper producers Freeport-McMoRan (FCX), BHP Billiton (BHP), and Rio Tinto (RIO) fell ~0.96%, ~0.67%, and ~0.34%, respectively. Glencore (GLNCY) gained ~0.04%. The SPDR S&P Metals & Mining ETF (XME) fell ~1.2% and the PowerShares DB Base Metals (DBB) gained ~0.37%.
In the next part, we’ll discuss how gold performed on August 2.