Copper Is Stable, Gold and Silver Are Weak Early on November 7



Copper prices are stable at a six-month high

After rising for nine consecutive trading days, copper prices are stronger at six-month high price levels early on November 7. At 5:50 AM EST on November 7, the COMEX copper futures contract for December delivery was trading at $2.3 per pound—a gain of ~1.3%. Copper rose despite the stronger dollar.

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Optimism about the Chinese economy supported copper

Increasing optimism about improved economic activity in China supported the copper prices. Considering that China is the largest copper consumer, the strength of China’s economy impacts copper’s demand and price trends. According to the latest reports, China’s manufacturing output rose to more than a five-year high. The manufacturing PMI reached the highest level since July 2014. According to the Caixin manufacturing PMI data released on November 1, the manufacturing PMI for October rose to 51.2.

Last week, major copper producers Freeport-McMoRan (FCX), Glencore (GLNCY), BHP Billiton (BHP), and Rio Tinto (RIO) fell 1.2%, 3.1%, 2.9%, and 2.6%, respectively. The SPDR S&P Metals & Mining ETF (XME) rose 2.2%, while the PowerShares DB Base Metals (DBB) fell 0.35%.

Gold and silver are weaker in the early hours

Gold and silver were weaker in the early hours as the FBI cleared Hilary Clinton over her emails. It dented the demand for the safe-haven assets such as gold and silver. The increased chances of an interest rate hike in December also weighed on gold prices. At 6:00 AM EST on November 7, the COMEX gold futures contract for December delivery fell ~1.2% to $1,288.65 per ounce. The silver futures contract for December delivery was trading at $18.26 per ounce—a fall of ~0.62%.

Last week, precious metal producers Barrick Gold (ABX), Newmont Mining (NEM), and Royal Gold (RGLD) rose 3.9%, 2.1%, and 10.2%, respectively, while Silver Wheaton (SLW) fell 1.3%. The SPDR Gold Trust ETF (GLD) rose 2%.


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