Copper prices pulled back on Wednesday, extending their fall to a fifth consecutive session, under pressure from a strong dollar, worries about demand in top metals consumer China and easing supply concerns.

Benchmark copper HG1! on the London Metal Exchange was down 0.2% to $10,640.50 a metric ton at 1049 GMT.

The metal, used in power and construction, is down 5% since worries about tighter global supply pushed it to a record high of $11,200 a week ago. This correction drove the metal below the 21-day moving average, which became the level of resistance at around $10,779.

“The pullback in copper appears to reflect a healthy consolidation, with some excess momentum being unwound from the market, potentially offering some room for a modest rebound once positioning stabilises,” analysts at Sucden Financial said.

FIRMER DOLLAR WEIGHS

Copper is still up 22% so far this year, heading for the largest yearly gain since 2021.

The metal is likely to trade in a $10,000 to $11,000 range in the near term as risk sentiment deteriorates, macroeconomic drivers weigh and last week’s weak official Chinese manufacturing PMI data adds to concerns, said Standard Chartered analyst Sudakshina Unnikrishnan.

The Chinese yuan eased to a two-week low against the U.S. currency on Wednesday, making dollar-priced metals more expensive for the Chinese buyers. Beijing will release trade data on Friday. Credit lending and activity indicators are due next week.

Providing support were signs of easing trade tensions between Washington and Beijing: China said it would remove export control measures against 15 U.S. entities and continue to pause such measures for another 16 entities for a year, effective November 10.

In other LME metals, aluminium ALI1! fell 0.2% to $2,852 a ton, zinc ZNC1! lost 1.2% to $3,051.50, lead LEAD1! was steady at $2,022.50, while tin FTIN1! slid 0.6% to $35,550.

Nickel NICKEL1! was little changed at $15,075 after hitting $15,015, its lowest since August 22.
Source: Reuters