Aluminium falls as weak China data fuels demand worries
LONDON — Aluminum prices slipped on Wednesday after weak Chinese trade data fueled worries about demand from the world’s top metals consumer, overshadowing the easing of COVID-19 restrictions in the country.
A weaker dollar, however, helped trim losses in aluminum and send copper and others climbing.
Three-month aluminum on the London Metal Exchange dropped 0.3% to $2,502 a tonne by 1725 GMT after giving up 0.6% on Tuesday.
Weighing on the market was data showing China’s exports and imports in November shrank at their steepest pace in at least 2-1/2 years.
LME aluminum has gained about 12% since the beginning of November, largely on hopes for a recovery of demand in China due to easing of coronavirus restrictions and measures to support the troubled property sector.
“From our perspective, we’re not expecting a sudden turnaround in China’s property market in the near-term,” said Edward Gardner, commodities economist at Capital Economics.
“We think perhaps this rally was a bit overdone and the fall in prices today is quite justified, coupled with the fact that global manufacturing and services PMIs are in contractionary territory as of November, in particular the new orders component.”
Partly offsetting the demand concerns was news that China announced the most sweeping changes to its tough anti-COVID regime since the pandemic began three years ago.
Also providing a boost was a weaker dollar index, making commodities priced in the U.S. currency cheaper for buyers using other currencies.
LME zinc rose 1.5% to $3,204 a tonne after Nyrstar said its Auby zinc smelter in northern France had been placed on care and maintenance until further notice.
Among other metals, LME copper gained 0.8% to $8,487.50 a tonne, nickel jumped 3.9% to $30,405, lead added 0.2% to $2,224.50, but tin slid 2.2% to $24,280.
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