Copper falls ahead of new Chinese economic data
The price of copper fell Friday ahead of reports expected this weekend that could shed more light on the extent of China's economic slowdown.
Copper for July delivery dropped 8.55 cents, or 2.5 percent, to finish at $3.285 per pound. It's the lowest price since mid-December.
China is scheduled to release May trade and industrial data this weekend. Analysts speculated that the details may show China's economy is weaker than expected. That could affect demand for copper and other commodities because China is a huge importer of raw materials.
China has been working to reverse a slowdown in its economy, which is the second biggest in the world behind the U.S. Leaders cut state-set gasoline and diesel prices Friday, a day after cutting an interest rate to try to promote growth.
The interest rate cut "may be a hint that the economy is actually weaker than the government is portraying it to be," INTL FC Stone metals analyst Edward Meir said in an emailed report.
In addition to China, investors also worry about Europe's financial crisis and a weaker U.S. economy.
The Commerce Department said Friday that U.S. exports fell 0.8 percent to $182.9 billion in April after hitting a record in March. Export sales declined to Europe, China and Brazil, which shows that the slower global economy is hurting demand for U.S.-manufactured products.
Meanwhile, leaders in Spain are considering a request for bailout funding for the troubled banking sector. Greece also is drawing attention because of a June 17 election that could mean its departure from the group of countries that use the euro as currency.
Concerns about the overall global economy strengthened the dollar against the euro. Commodities are priced in dollars so they become more expensive for traders who use other currencies when the value of the dollar rises.
Kingsview Financial analyst Matt Zeman said that he expects commodities trading to remain volatile until the Greek election has ended. "I suspect the dollar is going to stay on the firm side and that's going to keep some pressure on some of these commodities," he said.
Gold for August delivery rose $3.40 to end at $1,591.40 an ounce. July silver dropped 5.8 cents to $28.471 an ounce, July platinum declined $15.80 to $1,425.10 an ounce and September palladium ended down $13.75 at $612 an ounce.
In agricultural contracts for July, wheat fell 11.5 cents to finish at $6.3025 per bushel, corn rose 4 cents to $5.98 per bushel and soybeans fell 1.75 cents to $14.2625 per bushel.
Benchmark oil dropped 72 cents to end at $84.10 per barrel, heating oil rose 0.5 cent to $2.6721 per gallon, gasoline gained 0.02 cent to $2.6852 per gallon and natural gas ended up 2.5 cents at $2.299 per 1,000 cubic feet.