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The most-traded August copper contract on the Shanghai Futures Exchange finished daytime trading 0.1% lower at 68,920 yuan ($10,622.20) a tonne but was still on course for a weekly gain.
The rapid spread of the highly contagious Delta variant of COVID-19 in some emerging markets has raised concerns that the global economic rebound might be derailed, dampening expectations for metals demand.
A possible monetary policy easing in China did not help sentiment in Shanghai because it was viewed as a sign of weakness in the world’s top metals consumer.
“This created a risk-off tone across markets, with copper the lightning rod for these concerns,” said ANZ senior commodity strategist Daniel Hynes.
China has stepped up efforts to rein in runaway metals prices, including selling supplies from state reserves, triggering a drop in steel and copper prices.
The first release of metals in over a decade included 20,000 tonnes of copper, 30,000 tonnes of zinc and 50,000 tonnes of aluminum and was concluded via a public auction conducted on Monday.
Some of the highest bids accepted included 67,718 yuan ($10,474) a tonne for copper, 18,074 yuan a tonne for aluminum and 21,200 yuan a tonne for zinc, all of which were below spot market prices.
(With files from Bloomberg and Reuters)
