FX:Copper futures decline as markets turn jittery ahead of ECB
Forexpros - Copper futures were lower during European morning hours on Wednesday, as investors braced for the possibility that the European Central Bank will act less boldly than they earlier hoped.
Mounting concerns over the health of the global economy further weighed on appetite for growth-linked assets.
On the Comex division of the New York Mercantile Exchange, copper futures for December delivery traded at USD3.450 a pound during European morning trade, shedding 0.55%.
Earlier in the day, prices fell by as much as 0.65% to hit a session low of USD3.447 a pound.
Investors were jittery ahead of the ECB’s policy meeting on Thursday, at which President Mario Draghi was expected to announce details of measures to help stabilize the region’s sovereign debt markets.
ECB President Mario Draghi told European lawmakers on Monday that purchases of short-term sovereign bonds to help debt-burdened countries like Spain and Italy would not breach European Union rules.
Market sentiment remained vulnerable however, amid growing fears that the central bank may disappoint.
Copper futures came under further pressure after data released Tuesday showed that manufacturing activity in the U.S. contracted for the third consecutive month in August, fuelling concerns over the health of the world’s largest economy.
The gloomy manufacturing data came a day after a report showed that manufacturing activity in China fell to the lowest level in three years last month, while the euro zone’s manufacturing sector contracted for the 13th month in a row in August.
Meanwhile, market participants also looked ahead to Friday’s crucial U.S. non-farm payrolls data, which will allow investors to gauge the strength of the labor market and the need for additional easing by the Federal Reserve.
A disappointing jobs report could influence the Fed’s decision at its next policy meeting starting on September 12.
Mounting speculation the U.S. central bank was moving closer to introducing fresh measures to stimulate growth in the U.S. economy has helped support market sentiment in recent sessions.
Elsewhere on the Comex, gold for October delivery dipped 0.2% to trade at USD1,690.15 a troy ounce, while silver for December delivery dropped 0.95% to trade at USD32.11 a troy ounce.
