Copper slumped the most in two weeks as a report showing slower-than-forecast job gains in the U.S. fueled concern that the economic recovery will falter, eroding demand for raw materials.
Payrolls expanded by 80,000 in June, the U.S. Labor Department reported today, less than the 100,000-job increase forecast in a Bloomberg survey. The European Central Bank yesterday reduced its benchmark interest rate to a record of 0.75 percent to spur growth, and the People’s Bank of China cut borrowing costs for a second time in a month. The Standard & Poor’s GSCI gauge of 24 commodities tumbled the most in two weeks, while the dollar rose to the highest against a basket of six currencies since June 1.
“Many people are asking their clients to move to cash for the second half of the year as the outlook is getting worse,” Michael Smith, the president of T&K Futures and Options in Port St. Lucie, Florida, said in a telephone interview.
Copper futures for September delivery fell 2.4 percent to settle at $3.4095 a pound at 1:17 p.m. on the Comex in New York, the biggest drop since June 21 and a weekly decline of 2.5 percent. Prices may slip to $3.30, Smith said, without giving a time frame.
On the London Metal Exchange, copper for delivery in three months tumbled 2.1 percent to $7,531 a metric ton ($3.42 a pound.).
Tin slumped 2.1 percent, the biggest fall since May 30, while nickel slipped 3.3 percent, the most in more than two weeks. Aluminum, lead, and zinc also declined in London.
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