Copper prices extended their rebound from the previous week’s slump, tracking a rallyh in tech shares because of metal’s utilization in data centers and power infrastructure.
Copper has moved in tandem with AI stocks in recent months. Last week, it had declined 2.7% to a three-month low as concerns arose after the Democrats’ sweeping victory in the US midterm elections, which could mean greater regulation of AI.
Stocks grew on Tuesday with South Korea’s tech-heavy index Kospi being the top performer in the region. In China, the market was hut a supply squeeze which is driving a rapid increase in spot premiums to record levels.
The tightness has started to bring in more imported cargoes as traders aim to take advantage of an arbitrage window to bring in metal from overseas at a profit, Jinrui Futures Co. said in a note.
Investors were also monitoring a major shortage in the global aluminum market fueled by declining stockpiles of the crucial industrial commodity. Buyers are facing rising prices for spot metal and there is little immediate prospect of relief before new shipments from Indonesia arrive.
Copper rose 0.3% to $13,937 a ton on the London Metal Exchange as of 10:52 a.m. in Shanghai. Aluminum slipped 0.3% to $3,058.50, while other metals edged higher. Iron ore was down 0.2% at $92.55 a ton in Singapore.
With inputs from Bloomberg