Industrial metals prices gain as global trade war fears fade

Industrial metals prices rose on Tuesday after reports of behind-the-scenes talks between the US and China fuelled hopes that a trade war could be averted and sparked a global stock market recovery.

Benchmark copper on the London Metal Exchange did not trade in official rings but was bid up 1.3 per cent at $6,687 a tonne, after touching a 3-1/2-month low on Monday.

“Copper is trying to react to the improved sentiment in the stock market (and) reduced fears about global trade tensions,” said Saxo Bank analyst Ole Hansen. But he said prices were unlikely to rally far. “With inventories on the rise, the market lukewarm about the near-term prospects for Chinese demand and the speculative community having sliced their longs to the lowest in a couple of years, there's not much of an appetite (for copper) right now.”

Trump administration officials are asking China to cut tariffs on imported cars, allow foreign majority ownership of financial services firms and buy more US-made semiconductors in negotiations to avoid plans to slap tariffs on a host of Chinese goods and a potential trade war.