Copper prices fell sharply Monday as traders took profits from recent highs.
The July futures fell as far as $3.4640 per pound in overnight screen trading on the New York Mercantile Exchange, a loss of 40 cents. By Monday morning, however, they had trimmed this loss to 9.4 cents at $3.7700.
There does not appear to be any major metals-specific industry news behind Monday’s decline, said Edward Meir, analyst with Man Financial.
“Instead, we think the weakness has been brought about by the increasing alarm expressed in the swooning U.S. equity markets over rising commodity prices and their impact on inflation,” he said. “This is a legitimate concern, as rising inflation will keep the Fed on a more hawkish course for much longer, and eventually lead to a slowdown in growth.
In other words, there’s no good technical reason having to do with actual mining or consuming of coppoer behind this recent price rise, it’s all money speculation.
I don’t think stampers are well served when their base metal prices are so fluid.