Copper prices tumbled to their lowest level in nearly four months on Friday, with the metal on track for its steepest weekly decline since March. Benchmark three-month copper on the London Metal Exchange fell 1.6% to $13,371.50 a metric ton, hitting a session low of $13,358, the weakest since July 17. The metal is poised for a 2.9% weekly drop, marking its fifth consecutive week of losses and the largest weekly loss since March.
The downturn has been attributed to a selloff in AI-related equities, which copper is closely tied to due to its use in electrification and data centers. Goldman Sachs noted that the decline followed the Democratic victory in the US midterms and worsened after Nvidia CEO Jensen Huang's resignation on Thursday. However, the bank emphasized that the correction was more about positioning than weakening copper fundamentals, pointing to tight supply in China, where inventories are low and premiums are high.
Copper stocks in Shanghai Futures Exchange warehouses dropped another 18.3% this week to just 27,642 tons, the lowest since December 2023. The Yangshan copper premium, a key indicator of China’s import demand, reached a record $285 a ton on Friday. Meanwhile, other metals also saw declines: aluminium fell 0.6% to $3,011 a ton, zinc dropped 0.3% to $3,704, and nickel lost 1.6% to $15,950. Tin shed 0.2% to $46,580, while lead was the sole gainer, rising 0.4% to $1,893.50.