NEW YORK — Copper entered a narrow trading range Monday after six consecutive weeks of gains pushed the commodity to a six-month high last Thursday.
The rally was driven by tightening global supplies, including reduced concentrate availability from the Democratic Republic of Congo and inventory draws across the London Metal Exchange and Shanghai Futures Exchange. Physical conditions in China remained supportive, reflected in firming premiums.
High prices have begun to suppress downstream production willingness, creating a demand ceiling that traders are watching closely. After a five-week unwind, speculators rebuilt net long positions — though expectations of further Fed tightening could prompt quick position trimming.
Markets currently price a 44 percent probability of a Federal Reserve rate hike in September, reflecting recent soft U.S. employment data that reduced near-term pressure on borrowing costs. Wednesday's consumer price index report is the week's key data point. Median forecasts call for a 0.1 percent rise in headline prices and 0.2 percent in core. A hotter print would likely compress front-end spreads and force another round of position trimming in rate-sensitive commodity longs.
Friday brings July retail sales, with forecasts projecting a 0.2 percent increase. Downside risk is real: Amazon moved its Prime Day from July to June this year, which could weigh on the headline number.
Geopolitical risk kept oil bid. Brent crude rose 1.0 percent to $84.40 per barrel; U.S. crude gained 0.7 percent to $78.55. Iran said Sunday it was nearing an agreement with Oman to define new shipping lanes through the Strait of Hormuz but reiterated the waterway would not reopen until the United States meets certain conditions. Houthis said they resumed attacks on the Red Sea port of Mocha, adding pressure on traffic through the Bab el-Mandeb strait.
Treasury Secretary Scott Bessent said over the weekend that the Strait of Hormuz would become irrelevant, arguing oil would eventually be redirected via pipelines.
Asian stocks were mostly higher Monday, following Friday's Wall Street rally. Analysts at Bank of America said earnings per share rose 30 percent year-over-year excluding investment gains from Alphabet and Amazon, with AI-related stocks posting 28 percent median earnings growth against 12 percent for non-AI stocks. Consensus expects AI earnings growth to slow below 16 percent next quarter. This week's earnings calendar includes Applied Materials, Cisco and CoreWeave.
