In market news, we are finding a reasonably steady LME, however the Australian Dollar seems to be on a bit of a slide (currently trading around 1.0254). With the Chinese markets and most traders on holidays this week, the market will lack direction with the biggest consumer of metals effectively out of the market.
**** DJ MARKET TALK:LME Base Metals May Struggle For Direction;Eye US Data **** By Arpan Mukherjee
LME base metals are likely to struggle for direction amid thin trading with Chinese markets shut for a holiday. Analysts at Barclays say China’s copper demand will likely remain subdued in the near term as demand from the power sector has slowed and stimulus measures announced by the government this summer have yet to translate into demand.
**** DJ BASE METALS: Currency Shifts Lift Copper Prices **** By Tatyana Shumsky
NEW YORK–Copper futures settled higher Tuesday as investors looked to upbeat cues from currency markets and trading volumes remained low amid a public holiday in China.
Foreign-exchange markets gave dollar-denominated copper futures a boost, with the euro marching higher against the U.S. dollar. Dollar-denominated copper becomes less expensive for investors who use other currencies when the dollar weakens.
Traders based in China were notably absent from markets Tuesday, helping copper futures climb higher. The Asian nation paused for the annual Golden Week celebrations, which began with National Day on Oct. 1. When trading volumes decline, each individual trade has a larger impact on price discovery.
China is the world’s largest consumer of copper and accounts for about 40% of global demand for the metal.”We expect market conditions to remain choppy and thin with the Chinese traders effectively out of the game this week,” brokers at Sucden Financial said in a note to clients.