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Copper edges lower as Ukraine tensions weigh

Published 03/17/2014, 05:47 AM
Copper slumps on Crimea tensions
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Investing.com - Copper prices edged lower on Monday, as concerns escalated over Ukraine after results of Sunday's referendum showed voters in Crimea voting to join Russia.

On the Comex division of the New York Mercantile Exchange, copper futures for May delivery fell to a session low of $2.922 a pound, before trimming losses to last trade at $2.946 a pound during European morning hours, down 0.15%, or $0.004 cents.

The May copper contract rose 0.94%, or 0.275 cents to settle at $2.950 a pound on Friday.

Futures were likely to find support at $2.912 a pound, the low from March 14 and resistance at $2.977 a pound, the high from March 13.

Results showed that nearly 97% of voters in Crimea chose to break away from Ukraine and join Russia in a referendum deemed illegal by the European Union and the U.S.

Russia's lower house of parliament has stated that it will pass legislation allowing Crimea to join the nation in the "very near future."

U.S. President Barack Obama said Washington rejected the results of the referendum and warned that the U.S. was ready to impose sanctions on Moscow.

Western countries have threatened to ratchet up sanctions against Russia if it does not back down on annexing Crimea.

Copper has been under heavy selling pressure in recent sessions as growing concerns over the health of China’s economy dampened demand for growth-linked assets.

The industrial metal fell to $2.908 a pound on March 12, the lowest since July 2010.

The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.

Elsewhere on the Comex, gold for April delivery was flat to trade at $1,378.90 a troy ounce, while silver for May delivery shed 0.15% to trade at $21.38 an ounce.

Market players looked ahead to key U.S. economic data later in the day for further indications on the strength of the economy and the future course of monetary policy.

The U.S. is to publish data on manufacturing activity in the Empire State, as well as reports on industrial production and long term securities transactions.

The Federal Reserve is to kick off its two-day policy-setting meeting on Tuesday, amid expectations for a reduction in its bond buying program to $55 billion from the current $65 billion.

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