Copper futures prices plummeted Tuesday on New York’s Commodity Exchange as edgy speculators ignored bullish supply-and-demand factors and sold heavily on fears that the market had topped.
On other markets, precious metals were mixed, grains and soybeans were lower, livestock and meat futures were mostly higher, energy futures retreated and stock index futures advanced.
The miners strike in Peru, the world’s sixth-largest copper producer, entered its fifth week with no hint of a settlement, but most futures traders sold the market anyway.
Copper settled 2.7 cents to 6.1 cents lower, with the contract for delivery in December at $1.299 a pound and the spot November contract at $1.369 a pound, about 17 cents below the record high of $1.538 reached Nov. 2.
“The market is caught in the throes of bearish sentiment,” said George Anagnos, metals market analyst with Thomson McKinnon Securities Inc. in Chicago.
“It’s sort of like a snowball going down a hill,” Anagnos said. “It tends to gain momentum to the downside.”
The selloff was sparked by weakening technical signals, the chart patterns followed by many speculators, he said. As more people sold, prices kept falling to levels that triggered further selling.
Indication of Upturn
But Anagnos noted that last year’s extraordinary copper rally, which saw prices hit $1.46 a pound on New Year’s Eve, included a 20-cent correction, so the price slide of the past two weeks was not unprecedented.
“This doesn’t indicate the market is incapable of resuming its upside move,” he said. “The fundamental situation to me still portends upward prices.”
Gold futures rose slightly, but silver prices fell on the Commodity Exchange.
Gold settled 40 cents to 60 cents higher, with December at $425.60 an ounce; silver was 5 cents to 5.2 cents lower, with December at $6.393 an ounce.
Soybean futures prices settled at a 3 1/2-month low on the Chicago Board of Trade on a late round of speculative selling. Corn also finished sharply lower while wheat futures were mixed.
Prices were weak all session amid bearish chart signals and disappointment over the relatively slow pace of grain exports. Even the Agriculture Department’s announcement late Monday of a 300,000-metric-ton corn sale to the Soviet Union did not rally the corn market, which was expecting a Soviet corn purchase of up to 2 million metric tons.
Cattle futures settled sharply higher on the Chicago Mercantile Exchange, buoyed by improving cash markets and strong buying by commercial players, analysts said.
Pork futures enjoyed some spillover support from the adjacent cattle pits, but gains were limited by expectations of lower cash prices today and concerns about the rapid buildup of pork bellies in cold storage.