Copper prices dropped for the fourth consecutive session on Friday, heading toward their worst weekly performance since March. The decline was driven by a sell-off in technology stocks, though supply constraints helped limit the downside. Benchmark three-month copper on the London Metal Exchange fell 0.5% to $13,775 a metric ton, after earlier hitting a low of $13,636. The metal is now on track for a 2.6% weekly loss, the steepest since late March.
The rout in copper came amid broader market concerns over potential regulatory crackdowns on artificial intelligence following the Democratic Party's gains in the U.S. Congress. Deutsche Bank's head of metals research, Daniel Ghali, noted that markets were still digesting the implications of a potential 'blue wave,' which could reduce the likelihood of import tariffs on refined copper. Ghali also highlighted that copper prices on the U.S. COMEX exchange briefly dipped below LME prices before recovering.
Supply tightness remained a key factor supporting copper prices. Stocks in Shanghai Futures Exchange warehouses plummeted over 24% this week to just 33,848 tons, the lowest in nearly three years. Meanwhile, the Yangshan premium, a measure of Chinese demand for copper imports, surged to a record $217.50 a ton. The cash LME copper contract also traded at a $181 premium over the three-month forward, signaling near-term supply constraints outside the U.S.
Other industrial metals also saw declines, with aluminum down 0.5%, zinc shedding 1.6%, lead losing 0.5%, and nickel easing 0.2% after recent gains. Tin was the sole gainer, rising 1.7% following a sharp drop the previous day.