Copper wallows near multi-month lows as recession fears bite

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Copper prices languished near 17-month

lows on Tuesday on heightened worries that aggressive rate hikes

by central banks to tackle soaring inflation would push

economies into a recession and dent demand for metals.

FUNDAMENTALS

* Three-month copper on the London Metal Exchange

was down 0.2% at $7,993 a tonne, as of 0244 GMT, after hitting

its lowest since February 2021 at $7,918 on Monday.

* The most-traded August copper contract in Shanghai

fell 0.7% to 60,770 yuan ($9,081.54) a tonne.

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* Pulling down economic activity are soaring inflation and

interest rate hikes in many countries including the United

States where the Federal Reserve is expected to deliver another

75-basis-point hike this month.

* China’s services activity snapped three months of losses

in June and grew at the fastest rate in almost a year as easing

COVID-19 curbs revived demand, although firms remained cautious

about hiring, a private-sector survey showed.

* Japan’s services sector activity expanded at the fastest

pace in more than eight years in June as the easing of

coronavirus curbs boosted sentiment among businesses such as

those in tourism.

* Mainland China reported 418 new coronavirus cases for July

4, compared with 460 new cases a day earlier, the National

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Health Commission said.

* The premium for aluminum shipments to Japanese buyers for

July to September was set at $148 a tonne, down 14% from the

previous quarter, to reflect weak demand for automobiles and

rising local inventory.

* Chile’s total copper production fell 2.55% in May to reach

478,800 tonnes, government body Cochilco said on Monday.

* Global copper smelting activity declined in June, hit by a

stoppage in top producer Chile, data from satellite surveillance

of metal processing plants showed on Monday.

MARKETS NEWS

* Asian shares rose on Tuesday as market sentiment got a

boost after Japan reported positive economic data.

DATA/EVENTS (GMT)

0430 Australia RBA Cash Rate July

0500 India S&P Global Svcs PMI June

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0750 France S&P Global Svcs, Comp PMIs June

0755 Germany S&P Global Svcs PMI June

0755 Germany S&P Global Comp Final PMI June

0800 EU S&P Global Svcs, Comp Final PMIs June

0830 UK Reserve Assets Total June

1400 US Factory Orders MM May

PRICES

Three month LME copper

Most active ShFE copper

Three month LME aluminum

Most active ShFE aluminum

Three month LME zinc

Most active ShFE zinc

Three month LME lead

Most active ShFE lead

Three month LME nickel

Most active ShFE nickel

Three month LME tin

Most active ShFE tin

($1 = 6.6916 Chinese yuan)

(Reporting by Brijesh Patel in Bengaluru; Editing by Sherry

Jacob-Phillips)