Copper stumbles lower on U.S. banking crisis, firmer dollar

Copper stumbles lower on U.S. banking crisis, firmer dollar

Copper prices faltered on Tuesday, unsettled by worries about the knock-on impact of a U.S. banking crisis, a stronger dollar and a slow recovery of demand in top metals consumer China.

Three-month copper on the London Metal Exchange CMCU3 shed 0.6% to $8,878.50 a tonne by 1130 GMT after rising by 0.7% on Monday.

LME copper has dropped 7% since touching a seven-month peak of $9,550.50 a tonne in January, mainly due to concern about demand in China and climbing global interest rates.

“It’s still the headlines about the U.S. banks that’s the dominating factor today, creating broad risk-off sentiment across markets. So far the contagion to metals is limited but, we’re closely watching these events,” said Amelia Xiao Fu, head of commodity market strategy at Bank of China International.

Global shares tumbled along with oil and other risky assets, hit by continued concern about the implications of three U.S. banks having collapsed in less than a week. MKTS/GLOB

A stronger dollar index =USD also weighed on the metals market, making commodities priced in the U.S. currency more expensive for buyers using other currencies. FRX/

Uncertainty about the pace of recovery of metals demand in China was also undermining prices.

Learn more: Nasdaq icon