Copper tripped into the red on Tuesday, retreating from its highest level in more than a week, despite news of an emergency cut in US interest rates and hopes about more stimulus spending.
The move by the US Federal Reserve was its first emergency rate cut since 2008 at the height of the financial crisis.
One trader said that fuelled worries that the economic impact of the coronavirus outbreak could last longer than many expect as the disease spreads rapidly outside of China.
Three-month copper on the London Metal Exchange (LME) failed to trade in final open-outcry activity, but was bid down 0.6% at $5,665 a tonne after touching $5,780.50, its highest since February 21.
“We've been looking at our metals forecasts and we have revised them down because we do think there's going to be some lost demand this year, but we still expect higher prices by the end of the year," said Caroline Bain, chief commodities economist at Capital Economics in London.
Capital Economics expects prices to recover in the second half of the year, pushing LME copper to $6,200 by the end of 2020, she added.
The net speculative short position for LME nickel had climbed to 6.3% of open interest as of Friday, compared to the peak this year of 9.9%, according to estimates by broker Marex Spectron.
LME aluminium rose 0.2% in closing rings to trade at $1,722 a tonne, nickel shed 1.1% to $12,560, zinc dropped 2.3% to $1,975.50, lead dipped 0.3% to $1,841.50 and tin rose 0.8% at $16,750.
Source: Reuters
