The decline in U.S. bonds supported a rebound in copper prices, with LME copper closing up 0.94% last week. However, weak manufacturing data from China, cautious investor sentiment, high inventories, and weak consumption continue to limit price elasticity, suggesting that spot copper prices may decline today.
The decline in both the U.S. dollar and U.S. bonds has supported a rebound in copper prices, weakening market risk aversion and providing short-term price support for the copper market. This has encouraged traders holding non-dollar currencies to increase their trading activities. LME copper experienced volatility but ultimately closed strong at $9,087 per tonne, up $84 or 0.94%, with a trading volume of 21,638 lots, down by 4,712 lots, and an open interest of 291,614 lots, up by 1,131 lots. On Friday evening, Shanghai copper opened lower and rebounded before falling again, continuously searching for support, with the main September contract closing at ¥73,220 per tonne, down ¥720 or 0.97%.
As of August 2, the latest LME copper inventory was reported at 246,500 tonnes, an increase of 1,350 tonnes or 0.55% from the previous trading day.
Shanghai copper opened with a sharp decline today, with the main September contract opening at ¥72,480 per tonne at 09:01, down ¥1,460. Weak manufacturing data from China and persistent cautious sentiment among investors, combined with high inventories and weak consumption, continue to limit the upward elasticity of prices. The outlook for metal demand is pessimistic, and the market atmosphere remains weak, dragging down the entire non-ferrous metals sector. Copper’s fundamentals are similarly lacking highlights; despite a four-week decline in Shanghai copper inventories to a nearly two-month low, overall inventory levels remain high, exerting significant pressure on copper prices. Notably, China’s lack of specific and effective stimulus policies for the struggling real estate sector has heightened market concerns. Meanwhile, downstream industries are generally adopting a wait-and-see attitude due to significant copper price fluctuations, with a pessimistic outlook on future prices. Recent fluctuations in premiums have tended to stabilize, reflecting a lack of market confidence. In summary, copper prices are still at risk of falling in the short term, with multiple unfavorable factors converging, and it is expected that spot copper prices may continue to face downward pressure today.