Copper eased on Thursday as a private sector survey showed factory activity in top consumer China unexpectedly shrank, but hopes for higher metals demand as the world’s second largest economy reboots curbed price falls.
Lingering fears for a long recovery ahead for China pulled benchmark copper on the London Metal Exchange (LME) down 1.3% to $5,196 per tonne by 1611 GMT.
Prices touched their highest in over six weeks in early trade, helped by a reading of China’s official factory activity showing faster expansion in April.
However, that was offset by the closely watched Caixin survey which showed factory activity shrank last month as the coronavirus pandemic shattered global demand, sparking a substantial drop in export orders and more layoffs.
China accounts for nearly half of global copper consumption estimated at 24 million tonnes.
ING analyst Wenyu Yao said China’s recovery, although slow, had fueled the recent rally in copper prices and that supply cuts were also underpinning the market.