Exchange traded funds (ETFs) for copper have moved lower this week and felt additional selling pressure Wednesday after Goldman Sachs said it’s closing a recommended trade based on the industrial metal.
iPath Dow Jones-UBS Copper Total Return Subindex ETN (NYSEArca: JJC) was down over 2% in afternoon trade Wednesday.
Goldman strategists made waves earlier this week when they recommended pulling out of a commodities trade suggested in December 2010.
On Tuesday, Goldman analysts said the oil market is due for a “substantial pullback,” which contributed to the weakness in crude ETFs.
Now, the influential Wall Street firm has downgraded its outlook for copper, according to reports.
“We now believe that prices will likely remain rangebound in 2011 and that risk has become more symmetric given our view that inventories are unlikely to draw down to critically low levels before 2012,” Goldman said, Barron’s reported.