Worries over weaker growth in the emerging Asian economy, which accounts for about half the world’s copper and a similar proportion of other industrial materials demand, along with China’s months-long tariff kerfuffle with the U.S., have hit sentiment in the metals markets, analysts warned.
Base metals “will continue to see choppy price action amidst this ongoing macro uncertainty, although given the more bullish micro situation we look at price dips as buying opportunities,” Alastair Munro, a broker at Marex Spectron, said in a note.
The broker highlighted the low warehouse inventories and argued that it is likely that “any ratchet higher in trade war tensions is likely to result in China resorting to infrastructure stimulus to support growth,” which would be a net positive for copper prices.
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