The most-traded metals contracts on the Shanghai Futures Exchange lost ground on Monday after last week’s gains, amid seasonally low demand and as cautious traders watched the trade talks between U.S. and China, the world’s top two economies.

SHFE copper HG1! eased 0.42% to 79,000 yuan ($11,021.05) a metric ton by 0703 GMT, aluminium ALI1! slipped 0.65% to 20,615 yuan, zinc ZNC1! dropped 0.88% to 22,645 yuan, tin FTIN1! fell 1.26% to 267,880 yuan and nickel NICKEL1! declined 1.5% to 121,620 yuan.

The U.S. struck a framework agreement with the European Union on Sunday, imposing a 15% import tariff on most EU goods – half the threatened rate – and averting a bigger trade war between the two allies involving almost a third of global trade.

“The Chinese market is closely watching the trade talks between the U.S. and China, and any deals between the two will probably differ from Europe and Japan, and an extension of an August 12 deadline has been speculated on,” said a Beijing-based metals analyst at a futures company.

Senior U.S. and Chinese negotiators will meet in Stockholm later in the day to tackle longstanding economic disputes at the centre of a trade war between the two countries, aiming to extend a truce keeping sharply higher tariffs at bay.

China’s demand for steel and most metals tends to be at seasonal low periods in scorching and rainy summer months of July and August.

However, copper inventories in warehouses monitored by the SHFE (CU-STX-SGH) fell 13% week-on-week to 73,423 tons by July 25, the lowest since December, limiting the price decline, according to the Beijing analyst.

Meanwhile, three-month lead on the London Metal Exchange LEAD1! rose 0.15% to $2,017 per ton and copper HG1! gained 0.31% to $9,800. Tin FTIN1! fell 0.27% to $33,970, aluminium ALI1! lost 0.34% to $2,626.5, zinc ZNC1! shed 0.35% to $2,813.5 and nickel NICKEL1! ebbed 0.75% to $15,205.
Source: Reuters