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The first sign of progress in trade talks in quite some time sent equity markets higher, with the S&P 500 closing at 2,970 on Friday, just 56 points shy of its record high 3,025.86 set on July 26. Nonferrous metals also got a boost last week, with support lines holding, and/or resistance lines being tested or overcome.
Coincidently, it seems that progress was also made in Brexit talks, and it’s a good thing too, because the October 31 deadline is just a few weeks away. In the "No Deal" category, however, the GM strike continues into its fourth week, with 46,000 union members and now several thousand nonunion workers at 55 locations in the US, and operations in Canada and Mexico are also affected.
And as this is being written, some 2,000 workers at Asarco voted to go on strike effective Sunday night unless a new labor agreement can be reached. About 170,000 mt of annual production will be affected should a walkout occur.
With the global copper market already in deficit, and inventories held in Comex, LME, and Shanghai warehouses representing less than one week of consumption, the stage could be getting set for a move to higher ground. As you know, we’ve been here before over the past 18 months when things were looking up for trade talks, only to see the markets turn lower when negotiations broke down.
But maybe this time, the preliminary U.S.-China trade deal is indeed real.
John Gross, publisher of The Copper Journal, is one of the metals industry's best resources on copper pricing trends. If you would like to learn more about how to manage your wire and cable inventory in this volatile market environment, email John at by clicking here or calling him at 631-824-6486.
