Copper prices lost momentum
After starting the week on a stable note, copper prices retreated from yearly highs on November 15. At 12:20 AM EST on November 15, the COMEX copper futures contract for December delivery was trading at $2.5 per pound—a fall of ~1.0%.
Profit-booking took the shine out of copper
Profit-booking amid analysts’ caution for correction in the rally took the shine out of copper on November 15. Copper prices gained as much as ~19% from their October lows because of better demand signals from China and expectations of increased US infrastructural spending. According to the “Commitment of Traders” report—released before the election results—that covers positions of that week until November 8, the net-long position in copper futures rose 150% to 59,300 contracts. Considering the impact of Donald Trump’s comments about his plans to increase infrastructure spending on copper prices, the next “Commitment of Traders” report might show an increase in net long positions in copper.
The better-than-expected Chinese economic data, especially the manufacturing PMI data, improved the sentiment in the market. Considering that China is the largest copper consumer, China’s economic strength will influence copper’s price and demand trends globally. The market is looking forward to the Foreign Direct Investment data for China. The data could weaken or strengthen the demand signals for copper from China.
At 12:30 PM EST on November 15, major copper producers Freeport-McMoRan (FCX), Glencore (GLNCY), BHP Billiton (BHP), and Rio Tinto (RIO) fell ~0.47%, ~5.8%, ~4.2%, and ~5.3%. The SPDR S&P Metals & Mining ETF (XME) and the PowerShares DB Base Metals (DBB) fell ~0.15% and ~0.46%.