Copper Rises in Broad Metals Rebound

Copper climbed to around $5.5 per pound on Wednesday, erasing the previous session’s losses as hopes for a Middle East ceasefire supported a broad rebound across metals markets. The US is reportedly pursuing diplomatic talks to end the war with Iran, though regional mediators are still awaiting a response from Tehran after it denied engaging in any negotiations with Washington. Copper and other metals had recently faced heavy selling pressure as the Iran war drove energy prices sharply higher, raising inflation risks and weighing on global growth prospects. Meanwhile, lower prices appeared to attract stronger Chinese buying, with industry data showing that China’s copper inventories posted their largest weekly decline this year. Manufacturing demand in China also continued to recover following a slowdown during the Lunar New Year holidays in February.

Copper dropped below $5.4 per pound on Tuesday, trimming gains from the previous session as hopes for a de-escalation in the Middle East conflict faded after Iran denied holding talks with the US to end the standoff. Tehran dismissed President Donald Trump’s announcement as an attempt to manipulate financial markets and launched new attacks on US targets, while Israel continued strikes against Iran. On Monday, copper had rebounded nearly 2% after Trump postponed planned US strikes on Iranian energy infrastructure, claiming negotiations were underway. The outcome of any talks and the potential reopening of the Strait of Hormuz remain highly uncertain, keeping traders cautious. Additionally, robust inventories at global exchanges continued to weigh on prices, with LME stockpiles near six-year highs and HFE inventories close to record levels.

Copper prices in the US rose to above $5.4 per pound on Monday, bouncing from the over three-month low of $5.2 earlier in the session as hopes of de-escalation in the Middle East conflict improved the outlook on global manufacturing. US President Trump stated that strikes on Iranian energy infrastructure would be suspended for five-days following constructive talks with Iran. Tehran denied that the talks took place, but the US attempt to lower energy prices trimmed concerns of stagflation to support forecasts on factory activity. Prices were also lifted by the pullback for the dollar as the development strengthens the case for a rate cut by the Federal Reserve this year. Still, ample inventories maintained prices negative year-to-date. Stockpiles at LME warehouses were close to their highest in six years, and those at the SHFE were near their highest on record.