IV:Copper slumps to 2-month low on China slowdown concerns
Investing.com - Copper futures fell to a two-month low on Monday, as growing concerns over a slowdown in demand from top consumer China weighed on the industrial metal.
On the Comex division of the New York Mercantile Exchange, copper futures for March delivery fell to a session low of USD3.184 a pound, the weakest since December 4, before trimming losses to trade at USD3.194 during European morning hours, down 0.1%.
The March copper contract settled down 0.91% on Friday to end at USD3.197 a pound. Copper futures were likely to find support at USD3.168 a pound, the low from December 2 and resistance at USD3.230 a pound, the high from January 31.
Copper prices have declined in each of the past eight sessions leading up to Monday, the longest losing streak since January 1996.
Data released earlier showed that China's official non-manufacturing PMI slipped to its lowest level since December 2008 in January, falling to 53.4 from 54.6 in December.
The deterioration in the services sector adds to declining manufacturing PMIs. Data released over the weekend showed that China’s official manufacturing PMI fell to a six-month low of 50.5 in January from 51.0 in December.
Last week, private sector data from HSBC confirmed a contraction in China’s manufacturing sector for the first time since July.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
Meanwhile, market players continued to monitor liquidity conditions in emerging markets, such as Turkey and South Africa.
Emerging markets economies have been hard hit in recent sessions by worries over the impact of cuts in Federal Reserve stimulus and concerns over a slowdown in China.
Investors looked ahead to key U.S. economic data later in the day to gauge the strength of the economy and for further indications on the future course of monetary policy.
The U.S. Institute of Supply Management is to produce data on manufacturing activity for January later in the session, a leading economic indicator.
Elsewhere on the Comex, gold for April delivery inched up 0.3% to trade at USD1,243.70 a troy ounce, while silver for March delivery added 0.2% to trade at USD19.16 a troy ounce.
