- London copper falls, taking 2-day decline to 2.2 percent
- Commodity markets cautious ahead of British PM's speech
- Nickel loses ground as Indonesia moves to boost exports
(Updates prices)
LME copper slid for a second session on Tuesday as a firmer U.S. dollar pressured the market, but expectations of strong demand in top consumer China put a floor under the market.
The pound hovered near three-month lows versus the dollar on Tuesday and stocks were mostly weaker as investors waited for British Prime Minister Theresa May to lay out plans to exit the European Union amid fears Britain will lose access to the single market.[MKTS/GLOB]
"The main issue in the market is Theresa May's speech on hard Brexit and as a result the dollar has strengthened, so we have some pressure on metals," Argonaut Securities analyst Helen Lau said.
"Fundamentals are fine, China's property market is on track to improve. It may scale back automobile purchase incentives but not significantly, so automobile production may continue to grow which is positive for copper."
Three-month copper on the London Metal Exchange CMCU3 had fallen 1.5 percent to $5,778 a tonne by 0729 GMT, extending losses from the previous session's 0.7-percent decline.
The most-traded copper contract on the Shanghai Futures Exchange SCFcv1 closed down 1.2 percent to 47,320 yuan a tonne.
The copper market is being weighed down by a stronger dollar, with investors taking profits after prices climbed to a five-week high on Monday.
Strong Chinese demand and positive economic data from the United States are supporting base metals. Chinese customs data on Friday showed the country shipped in a record 4.95 million tonnes of copper in 2016.
U.S. retail sales rose in December amid strong demand for automobiles and furniture, providing further evidence that the economy ended the fourth quarter with momentum and is poised for stronger growth this year.
LME nickel CMNI3 slid 0.6 percent, adding to Monday's 1.8 percent decline, on pressure from Indonesia's move to ease a ban on nickel ore exports.
Indonesia introduced new rules last week that will allow exports of nickel ore and bauxite and concentrates of other minerals under certain conditions in a sweeping policy shift by the key global supplier.
PRICES
Three month LME copper CMCU3 Most active ShFE copper SCFcv1 Three month LME aluminium CMAL3 Most active ShFE aluminium SAFcv1 Three month LME zinc CMZN3 Most active ShFE zinc SZNcv1 Three month LME lead CMPB3 Most active ShFE lead SPBcv1 Three month LME nickel CMNI3 Most active ShFE nickel SNIcv1 Three month LME tin CMSN3 Most active ShFE tin SSNcv1