Copper sank to a one-week low on Friday, tracking a fall in global financial stocks as signs of credit stress at U.S. regional banks rattled markets.

Benchmark three-month copper HG1! on the London Metal Exchange was down 0.8% at $10,565 per metric ton in official open outcry trading.

The metal widely used in power and construction had earlier slumped as much as 2% to $10,430, its lowest since October 10 and testing its 21-day moving average. Copper, considered a bellwether for the global economy, hit a 16-month high of $11,000 on October 9.

“It’s a generally risk-averse environment with the most risky assets under pressure,” said Thu Lan Nguyen, head of foreign exchange and commodities research at Commerzbank.

Copper’s losses were limited by a weaker dollar DXY, which makes dollar-denominated commodities more affordable for holders of other currencies.

Sentiment on base metals turned negative as financial stocks tumbled on Friday following a rout in U.S. regional banking shares on worries about mounting risks and credit quality. “It’s one additional concern, I would say, as regards the state of the U.S. economy,” Nguyen said.

Investors are also monitoring trade tensions between the United States and top copper consumer China, which on Thursday accused Washington of stoking panic over Beijing’s rare earth export controls.

U.S. President Donald Trump said on Friday his proposed 100% tariff on goods from China would not be sustainable, adding that he would meet with his Chinese counterpark, Xi Jinping, in two weeks.

Copper stocks in Shanghai Futures Exchange warehouses (CU-STX-SGH) rose by 550 tons over the past week to stand at 110,240 tons, the highest since April 25.

Most of the LME complex was trading lower on Friday. Aluminium ALI1! fell 0.5% to $2,774 a ton, zinc ZNC1! shed 0.9% to $2,946, nickel NICKEL1! lost 0.9% ti $15,125 and tin FTIN1! slipped 1.9% to $35,100. Only lead LEAD1! managed to climb, adding 0.6% to $1,976.50.
Source: Reuters