MANILA, July 11 (Reuters) - Copper prices slumped to their weakest level in a year and zinc fell to 13-month lows amid a broad selloff on Wednesday after the Trump administration said it would slap 10 percent tariffs on an extra $200 billion worth of Chinese imports.
U.S. President Donald Trump’s latest tariff threat escalates an already deepening trade war between the world’s two biggest economies, fuelling risk aversion across assets from commodities to equities.
“Is Trump playing his strong hand or is he making good on his ultimatum to escalate trade war with Beijing, that is yet to be determined?,” Stephen Innes, head of trading for Asia Pacific at brokerage OANDA, said in a note.
“But nonetheless, this is a very sobering reality check as to just how fragile sentiment around trade war rhetoric is and should keep markets trading defensively during Asia (hours).”
Three-month copper on the London Metal Exchange dropped as much as 3.8 percent to $6,092.50 a tonne, its lowest since July 25 last year. It was down 2.7 percent at $6,158.50 by 0140 GMT.
On the Shanghai Futures Exchange, the most-traded copper fell as far as 47,800 yuan a tonne, its weakest since June 23 last year.
Zinc was also hard hit, with the metal dropping by its 6 percent downside limit in Shanghai, and falling as much as 4.8 percent to $2,503 in London, the lowest since June 15 last year.
* NEW TARIFFS: U.S. officials released a list of thousands of Chinese imports the administration wants to hit with the tariffs, including hundreds of food products as well as tobacco, chemicals, coal, steel and aluminium.
Last week, Washington imposed 25 percent tariffs on $34 billion of Chinese imports, and Beijing responded immediately with matching tariffs on the same amount of U.S. exports to China.
* MARKETS: China’s shares opened sharply lower and other Asian stocks retreated and perceived safe havens such as the yen and U.S. Treasuries rose.
* OTHER METALS: Other metals also slid, with LME nickel down 3 percent and lead down 2.1 percent. In Shanghai, nickel and lead fell more than 2 percent.
* PHILIPPINES NICKEL: The Philippines’ nickel ore exports could drop by up to 17 percent this year as weaker prices curb output in the world’s second-biggest supplier, the head of a nickel mining industry group said on Tuesday.
Three month LME copper
Most active ShFE copper
Three month LME aluminium
Most active ShFE aluminium
Three month LME zinc
Most active ShFE zinc
Three month LME lead
Most active ShFE lead
Three month LME nickel
Most active ShFE nickel
Three month LME tin
Most active ShFE tin
Reporting by Manolo Serapio Jr.; Editing by Vyas Mohan