SINGAPORE — Most industrial metals declined on Monday as fears of a deep recession rose after several countries looked to prolong shutdowns to contain the unabating spread of the coronavirus.
Three-month copper on the London Metal Exchange fell 0.6% to $4,763 a tonne by 0710 GMT, aluminum slid 1% to $1,530.50 a tonne, nickel dipped 0.1% to $11,340 a tonne, zinc dropped 2% to $1,840.50 a tonne and lead lost 1.5% to trade at $1,679.50 a tonne.
The most-traded copper contract on the Shanghai Futures Exchange fell 0.8% to 38,720 yuan ($5,457.67) a tonne, aluminum declined 1.5% to 11,515 yuan a tonne, lead dropped 0.4% to 13,745 yuan a tonne, while nickel rose 0.9% to 93,000 yuan a tonne.
U.S. President Donald Trump on Sunday extended the stay-at-home guidelines for his country until the end of April, while a senior British medical official said some of their lockdown measures could last months.
However, prices of metals were less volatile on Monday compared with previous sessions, discouraging outright traders from participating and lowering volumes.
“Initially, it was an elevator going down because of the worsening economic prospects… but now we counter that with fiscal policy, monetary quantitative easing and shorts doing profit-taking,” said a base metal trader.
“This is a time where instead of playing flat price, one may try calendar spreads or arbitrage between exchanges.”
* ALUMINIUM: Plummeting aluminum prices due to the impact of the pandemic on demand are unlikely to persuade producers to immediately cut output as input costs have also