Copper Falls in New York After S&P Cuts Spain’s Credit Outlook
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By Millie Munshi
Dec. 9 (Bloomberg) -- Copper prices fell after Standard & Poor’s lowered Spain’s credit outlook to “negative,” fueling concern that the global economic recovery may stall.
Fitch Ratings yesterday downgraded Greece’s debt, and government-owned Dubai World last week said it’s in talks with banks to restructure $26 billion of loans. Copper prices, down 4.1 percent since Dec. 2, plunged a record 54 percent last year as frozen credit markets deepened the longest recession in at least seven decades.
“You’ve got all these credit-related fears right now, and people are shedding riskier assets,” said Matthew Zeman, a trader at LaSalle Futures Group in Chicago. “To see copper pull back is not surprising.”
Copper for March delivery fell 4.15 cents, or 1.3 percent, to $3.1235 a pound on the New York Mercantile Exchange’s Comex unit. The metal sank 2.9 percent in the previous four sessions.
Earlier, copper gained as much as 0.9 percent on supply concerns as workers blocked the entrance to a mine in Chile after wage talks ceased.
At state-owned Codelco’s Chuquicamata mine, workers blocked a road to the site and stopped production, according to Hernan Guerro, a union president. Codelco is the world’s biggest copper producer and Chile is the largest source of the metal.
Jose Pablo Arellano, Codelco’s chief executive officer, declined to say if production had stopped at Chuquicamata. Talks with workers have been “interrupted,” he said in Santiago.
“News of supply problems will lend some support to prices,” said Michael Gross, an OptionSellers.com trader in Tampa, Florida.
Traders will continue to “focus on the larger macroeconomic themes,” Gross said.
On the London Metal Exchange, copper for three-month delivery dropped $31, or 0.4 percent, to $6,945 a metric ton ($3.15 a pound). Among other LME-traded metals, lead and zinc fell. Nickel, tin and aluminum gained.
To contact the reporter on this story: Millie Munshi in New York at mmunshi@bloomberg.net.
Last Updated: December 9, 2009 15:04 EST
