RIO Rio Tinto Plc

   By David Hodari 
 

Copper prices slipped, dragged down by nagging anxieties about the state of the Chinese economy after a slew of negative data Tuesday.

The base metal was down 0.5% at $6,209 a metric ton in midmorning trade in London, extending its week-to-date losses to 1.2%.

Gold was up 0.1% at $1,228.28 a troy ounce, its early week gains having stalled amid gentle rallying across global equities indexes.

With gold's price nearing $1,230 an ounce, a move above that psychologically important level could spark more haven metal buying, said Carlo Alberto De Casa, chief analyst at ActivTrades.

Base metals failed to show similar optimism Tuesday after the highest Chinese inflation reading in seven months and the release of figures showing a 49% year-on-year drop in house sales in China's 10 major cities during this year's Golden Week--typically a time for big-ticket purchases.

On top of that, car sales fell in September for the third straight month, putting China on course for its first annual slip in passenger-car sales in almost three decades.

Elsewhere in the market, indications of rising supply added to the pressure from the suggestions of sagging Chinese demand.

Rio Tinto PLC (RIO)'s third-quarter-production results put copper front and centre, with output improving 6% at Escondida--the world's largest copper mine--and at other Rio mines as well.

Looking ahead, market participants were keeping an eye on stories affecting the broader commodities sector.

The White House and Saudi Arabia traded barbs and threats of sanctions Monday over the suspected killing of dissident Saudi journalist Jamal Khashoggi, testing the Trump administration's efforts to make the kingdom the focal point of its Middle East policy.

Base metals "will continue to see choppy price action amidst this ongoing macro uncertainty," said Alastair Munro, a broker at Marex Spectron. That said, "any ratchet higher in trade war tensions is likely to result in China resorting to infrastructure stimulus to support growth," a move which would be positive for copper prices, Mr. Munro said.

Among precious metals, silver was up 0.34% at $14.74 a troy ounce, palladium was down 0.17% at $1,086 a troy ounce and platinum was up 0.15% at $843.75 a troy ounce.

Among base metals, zinc was up 0.56% at $2,609 a metric ton, tin was down 0.1% at $19,140 a metric ton, nickel was down 0.9% at $12,470 a metric ton and lead was up 0.41% at $2,088 a metric ton.

Write to David Hodari at David.Hodari@wsj.com

(END) Dow Jones Newswires

October 16, 2018 07:09 ET (11:09 GMT)

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