AI sell-off suppresses risk appetite, copper prices follow downward

According to information from Zhihui Finance APP, on Thursday, copper prices fell alongside other industrial metals. This followed a sell-off in AI-related stocks, which drained risk appetite from global markets. London Metal Exchange (LME) copper prices once dropped 0.7%, to $14,260 per ton. The earnings reports from major technology companies failed to convince investors of the durability of the artificial intelligence trading boom, causing Asian stock markets to decline. Copper, used in data centers and power infrastructure, had previously benefited from this surge.

Copper prices have retreated from last month's all-time high of $14,875 per ton, also driven by suspicion in the market over whether the US will impose tariffs on refined copper, as US President Donald Trump's second term approaches its midpoint. The tariff expectation has attracted a large amount of copper into US warehouses this year, squeezing supply in other regions.

"There remains significant uncertainty in the supply-demand balance for copper next year," said Zhenting Zhou, a trader at Hangzhou Chenglian Industrial Co. "Mine supply should improve, US import demand may slow, and China's scrap copper supply is also expected to recover. The upside risk for copper prices is limited."

However, concerns about supply disruptions persist. Workers at Canada's largest copper mine—Highland Valley Copper under Teck Resources (TECK.US)—have threatened to go on strike as early as this Saturday. This is the latest sign of labor tensions: near record-high prices have emboldened employees to fight for a larger share of profits.

At the time of reporting, LME copper was down 0.4% at $14,294.50 per ton. Aluminum fell 0.6% to $3,023.50 per ton; nickel gave back 1%—after surging 3.7% in the previous session on expectations of coordinated output cuts by Chinese producers in Indonesia. Iron ore in Singapore once dropped 1.7% to $89.45 per ton, the lowest in nearly two years, before trimming losses.