Sign in Subscribe
Newspaper publishing

Copper Futures Fall Amid Weaker US Labor Market and Downbeat ECB Comments

Strategic Insights

— 1 min read

Copper futures slumped Thursday as concerns about slowing growth weighed on metals demand, with the commodity falling 2.05 cents to $4.1115 a pound on the Comex division of the New York Mercantile Exchange. The downturn came as the Labor Department reported a larger-than-expected increase in US jobless claims, which rose by 2,000 to 414,000 last week, citing persistently weak labor market conditions. Meanwhile, ECB President Jean-Claude Trichet's comments about cutting euro-zone growth forecasts and risks to the economic zone "being on the downside" added to the negative sentiment.

Key Takeaways:

  • Copper futures declined 2.05 cents to $4.1115 a pound on the Comex division of the New York Mercantile Exchange.
  • The US labor market showed a weaker-than-expected reading, with jobless claims increasing by 2,000 to 414,000 last week.
  • ECB President Jean-Claude Trichet announced that the European Central Bank had cut its euro-zone growth forecasts, citing risks to the economic zone "being on the downside".
  • Analysts expect quiet trading ahead of speeches by Federal Reserve Chairman Ben Bernanke and President Barack Obama, which may impact the copper market.
  • Workers at Peruvian mining company Sociedad Minera Cerro Verde began a two-day strike to demand higher wages, potentially leading to production losses.
  • Freeport-McMoRan Copper & Gold Inc. (FCX) majority-owned Cerro Verde may not experience a material impact from the strike, but analysts warn of potential longer-term consequences.

Statistics:

  • Copper futures fell 2.05 cents, or 0.5%, to $4.1115 a pound.
  • US jobless claims rose by 2,000 to 414,000 last week, exceeding the expected increase of 1,000.
  • ECB President Jean-Claude Trichet announced the European Central Bank's cut to euro-zone growth forecasts.
  • The strike at Peruvian mining company Sociedad Minera Cerro Verde began, with union leaders warning of possible indefinite action if demands are not met.
  • Freeport-McMoRan Copper & Gold Inc. (FCX) majority-owned Cerro Verde's production may not be significantly impacted in the short term, but the possibility of longer-term losses remains.

Sources:

  • Dow Jones Commodities News via Comtex
  • Dow Jones Newswires
  • Matt Day, Dow Jones Newswires
  • European Central Bank

Read more