Copper slid for a fifth day, the longest run since January, and nickel dropped as the biggest sell-off in Chinese equities since 2007 added to concerns about the economy.
The Shanghai Composite Index plunged 8.5 per cent. China's industrial profits fell in June, and data on Friday showed, a private gauge of manufacturing unexpectedly declined in July to the lowest level in 15 months. The country accounts for about 40 per cent of the world's copper consumption. "The negative sentiment in the base-metals markets is a direct reflection of the sharp fall in equity valuations in China," said Nic Brown, the head of commodity research at Natixis SA in London. "That is a serious question mark over the strength of the Chinese economy." Copper for delivery in three months lost 0.9 per cent to $5,215 a metric ton as of 12:09 pm on the London Metal Exchange. A close at that price would be the lowest since 2009. Nickel dropped 2.3 per cent. Chinese investors banned from shorting equities may be selling copper, exacerbating the metal's collapse. They're seeking to hedge exposure to shares after the government stepped in to stem a stock rout, according to brokers including Guotai & Junan Futures and Haitong Futures. On the LME, lead and zinc fell at least 0.5 percent. Aluminum and tin were little changed.
The Shanghai Composite Index plunged 8.5 per cent. China's industrial profits fell in June, and data on Friday showed, a private gauge of manufacturing unexpectedly declined in July to the lowest level in 15 months. The country accounts for about 40 per cent of the world's copper consumption. "The negative sentiment in the base-metals markets is a direct reflection of the sharp fall in equity valuations in China," said Nic Brown, the head of commodity research at Natixis SA in London. "That is a serious question mark over the strength of the Chinese economy." Copper for delivery in three months lost 0.9 per cent to $5,215 a metric ton as of 12:09 pm on the London Metal Exchange. A close at that price would be the lowest since 2009. Nickel dropped 2.3 per cent. Chinese investors banned from shorting equities may be selling copper, exacerbating the metal's collapse. They're seeking to hedge exposure to shares after the government stepped in to stem a stock rout, according to brokers including Guotai & Junan Futures and Haitong Futures. On the LME, lead and zinc fell at least 0.5 percent. Aluminum and tin were little changed.