Copper holds above $14,000 as investors weigh US election impact
By Solomon Cefai
SINGAPORE, Nov 4 (Reuters) - Copper clawed back earlier losses on Wednesday to hold above the psychologically important $14,000-a-metric-ton level, tracking swings in equity markets as investors assessed the implications of Democrats' sweeping victories in the US midterm elections.
Benchmark three-month copper on the London Metal Exchange was down 0.16% at $14,014 a ton by 0700 GMT. It earlier fell as much as 1.53% to touch its lowest since August 3.
The most-traded copper contract on the Shanghai Futures Exchange edged 0.41% lower to 107,670 yuan ($16,104.76) a ton.
"The US election results have triggered a rollercoaster across financial markets, including copper," said Ole Hansen, head of commodity strategy at Saxo Bank.
Markets are closely watching the decisive Democrat midterm election wins for clues on future AI regulation, US fiscal policy and the Iran war trajectory.
Copper initially came under pressure as concerns grew that tighter regulatory oversight could slow investment in AI infrastructure, a key source of expected future demand for the metal. However, losses narrowed as equities pared declines.
Investors are also reassessing the prospects for a potential US tariff on refined copper imports. Expectations of such a tariff have helped draw large volumes of copper into US warehouses this year, tightening supply elsewhere and contributing to the metal's record high in September.
"The (election) result reduces the likelihood of tariffs on refined copper, and this shift in expectations could weigh more heavily on prices in the near term than any potential changes to the longer-term demand outlook," Hansen said.
Among LME metals, aluminium was flat, zinc added 0.37%, lead dipped 0.13%, nickel gained 0.74% and tin ticked 0.08% higher.
On the SHFE, aluminium dipped 0.13%, zinc nudged up 0.04%, lead lost 0.72% and nickel dipped 0.08%. Tin was down 1.6% after earlier touching its lowest in seven months.
($1 = 6.6856 Chinese yuan)