Copper edges higher as Russian troops return to base
Copper prices ticked higher on Tuesday after Russia returned some troops to base after exercises near Ukraine, easing fears about a potential invasion and boosting financial markets.
Three-month copper CMCU3 on the London Metal Exchange (LME) rose 0.7% to $9 985 a tonne by 11:15 GMT after a 0.6% gain the previous day.
It was unclear how many Russian units were being withdrawn to their bases after an estimated 130 000 Russian troops had been moved close to the Ukraine border.
“The metals markets in the short-term remain at the mercy of the Ukraine situation, moving back and forth between risk-off and risk-on dynamic,” said Gianclaudio Torlizzi, partner at consultancy T-Commodity in Milan.
“But if we exclude the geopolitical pressures, the general trend remains on the upside for most of the metals.”
Any downside moves, including knee-jerk reactions to faster than expected US monetary tightening, would be a buying opportunity, Torlizzi added.
He has targets of $11 000 for copper, $3 500 for aluminium and $30 000 for nickel.
With physical buying in China expected to start picking up in the next few weeks as the economy returns to normal after the Lunar New Year holidays, visible copper stocks are likely to remain at multi-year lows in the near term, said CRU analyst Craig Lang.
The most-traded March copper contract SCFcv1 on the Shanghai Futures Exchange closed 0.3% down at 71 060 yuan ($11 190.90) a tonne.
