By Mai Nguyen
SINGAPORE, July 1 (Reuters) - Copper touched its highest in six weeks on Monday after a U.S.-China trade truce eased tensions between the world’s top two economies that have threatened global growth and metal demand.
U.S. and Chinese presidents on Saturday agreed to resume trade talks after both sides offered concessions, but Chinese state media warned of a “long road” before the countries can reach a deal, with potentially more fights ahead.
Benchmark copper in London rose as much as 1.4% to $6,075 a tonne, its highest since May 20, before easing slightly to $6,057.50 a tonne at 0700 GMT. Shanghai copper ended 0.8% higher to 47,360 yuan ($6,921.14) a tonne.
“The markets hopes were realised, with Trump and Xi agreeing to resume talks. This should boost sentiment in the base metals sector,” said ANZ in a note.
Most base metals rallied in early Asian trading hours but soon moved to trade in mixed ranges as investors reassessed the development in trade talks and amid disappointing factory data from China, the world’s top consumer of many metals.
“Significant obstacles remain to obtaining a long-term agreement,” said Michael Taylor, Moody’s Investors Service managing director, citing differences on core issues and a lack of mechanism to settle dispute between the two nations.
“The talks could still suffer further setbacks and the risk of further tariffs has not been removed yet,” Taylor said in a note.
China’s factory activity unexpectedly shrank in June amid faltering demand as the Sino-U.S. trade war drags on, private and official surveys showed.
Shanghai aluminium fell 0.6% and tin closed down 0.8%. London nickel retreated 1% to $12,560 a tonne after touching its highest since April 18 in early trade on Monday, while Shanghai nickel dropped 2.1%.
“Nickel price was so strong last week due to short position squeeze for ShFE July contract. Most investors already closed their position before July 1, so the buying activities came down (this week),” said a China-based nickel analyst.
“Lots of investors have been shooting (down) nickel price since March, as the nickel pig iron production is so high while the stainless steel market is not good,” the analyst added.
* CHUQUICAMATA: Chile’s Codelco, the world’s top copper miner, said on Friday its Chuquicamata mine was fully operational after a two-week long strike that had docked output from the sprawling deposit came to an end.
* GLENCORE: The number of artisanal miners killed by a landslide at a copper and cobalt mine run by Glencore in Congo rose to 43 on Friday and officials said the army would deploy at the mine as the search for more victims continued.
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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
ARBS ($1 = 6.8428 Chinese yuan renminbi)
Reporting by Mai Nguyen; Editing by Rashmi Aich