Copper slips as Omicron spreads and China slowsows

Copper prices edged lower on Thursday as fears over the spread of the Omicron coronavirus

  

LONDON- Copper prices edged lower on Thursday as fears over the spread of the Omicron coronavirus variant and slowing growth in China weakened the outlook for demand.

Global stock markets fell after the United States and France reported their first Omicron cases and countries around the world tightened travel restrictions. H0

Benchmark copper on the London Metal Exchange (LME) was down 0.3% at $9,412.50 a tonne at 1137 GMT and down around 4% from a week ago.

However, prices are still up some 20% this year and near a record high of $10,747.50 reached in May.

Metals have held up much better than oil, which has fallen around 15% in the last week, said WisdomTree analyst Nitesh Shah.

"This underscores how strong demand for copper is and how likely it is to come out of this period with structural strength," he said.

"As long as the market's thinking about the medium-term growth, copper should hold up pretty well."

RALLY: Used to transmit power, copper has been boosted by massive government stimulus and expectations of infrastructure building for electrification.

CHINA GROWTH: Advisers to China's government will recommend authorities set a 2022 economic growth target of 5-5.5%, below the 'above 6%' set for 2021, sources said. 

CHINA PROPERTY: Three Chinese developers plan to sell bonds in China to raise a combined 18 billion yuan ($2.83 billion), which should ease liquidity strains on the sector. 

However, analysts still expect China's property downturn - which has weighed on metals prices - to continue into the first half of 2022.

CHILE: The world's largest copper producer, Chile's Codelco, expects copper prices to fall in 2022 and the market to be oversupplied until 2024. 

ALUMINIUM: On-warrant aluminium inventories in LME-registered warehouses rose by 16% to 677,225 tonnes, data showed. 

PRICES: Benchmark LME aluminium was down 0.9% at $2,640 a tonne, zinc was up 0.1% at $3,206.50, nickel rose 0.1% to $19,965, lead fell 0.6% to $2,287 and tin CMSN3 was flat at $39,100.

(Reporting by Peter Hobson; Additional reporting by Mai Nguyen in Hanoi; Editing by Jan Harvey) ((Peter.Hobson@thomsonreuters.com; +44 207 542 0083;))


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