Copper surges after Trump postpones military strikes on Iranian power plants

Copper prices jumped on Monday after U.S. President Donald Trump said he will order the U.S. military to postpone any military strikes against Iranian power plants and energy infrastructure.

Benchmark copper on the London Metal Exchange traded 0.5% higher at $11,985 a metric ton in official rings. It had hit a three-month low ‌of $11,700 a ⁠ton ⁠earlier in the session after Iran said it would attack Israel's power plants and those supplying U.S. bases across the Gulf region if Trump carried out his threat to "obliterate" Iran's power network.

Traders said industrial metals were rising on the relief rally and a softer U.S. currency, which makes dollar-priced metals cheaper for buyers using other currencies. However, elevated ​oil prices still threaten global growth prospects as ⁠they push ‌up costs for households and businesses, fan inflation fears and ​dim hopes ​of rate cuts by central banks.


"The war, now in ⁠its fourth week, has pushed oil and gas prices higher, ​threatening to hurt economic activity worldwide and fuelling inflation ​that will likely force central banks to take a more hawkish stance on interest rates," Britannia Global Markets said in a note.

Also supporting sentiment were signs that demand might be recovering in top consumer China. Stocks of copper in warehouses monitored by the Shanghai Futures Exchange fell for the first time ‌since December. The Yangshan copper premium, a gauge of China's appetite for importing copper, has climbed to $48 a ton from $42 on March ​6. Elsewhere, focus ​remains on aluminium - ⁠supported by concerns about disruptions from the Middle East, which accounts for around 9% of global supplies.

However, profit-taking on long positions is weighing on prices of aluminium used ​in the auto, construction and packaging industries, traders said.

Premiums for nearby aluminium contracts against longer-dated forwards across the maturity curve suggest expectations of severe shortages.

Three-month aluminium firmed 0.2% to $3,220, zinc was flat at $3,068, lead rose 0.3% to $1,902, tin gained 0.7% to $43,600 and nickel added 0.2% to $17,050.