- London-listed mining stocks fall as London copper prices fall in response
US copper prices hit an all-time high overnight after US President Donald Trump shocked markets by slapping a 50 per cent tariff on imports of the critical metal.
Trump’s copper tariffs announcement, expected to come into effect in the coming weeks, sparked a frantic buying of the metal.
It is a vital material in the manufacture of electric vehicles, military hardware, the power grid and many consumer goods.
While US metals markets saw copper surge more than 12 per cent, London Metal Exchange prices were trading lower by late morning in the UK reflecting concerns that elevated prices across the Atlantic could hinder demand.
It drove shares in FTSE 100 Glencore, Antofagasta, Anglo American and Fresnillo around 2 per cent lower, weighing on FTSE 100 gains for the day. Copper giant Rio Tinto was down just 0.4 per cent.
FTSE 250-listed Hochschild Mining was down by almost 4 per cent.
Vital material: Copper is critical for electric vehicles, military hardware, the power grid and many consumer goods
It follows the imposition of US steel and aluminium tariffs at 50 per cent.
The UK currently remains at the previous rate of 25 per cent and that could drop to zero under the trans-Atlantic trade deal.
Trump is also said to be mulling eye-watering 200 per cent tariffs on pharmaceutical imports.
Copper as a ‘strategic resource’
Tom Bailey, head of research at HANetf, said: ‘Copper is no longer just an industrial metal. It is fast becoming a strategic resource.
‘Its role in AI infrastructure and renewable energy has placed it in the crosshairs of trade policy and geopolitical risk.
‘Like oil in the twentieth century, copper may increasingly be shaped by politics as much as by geology.’
He warned a surge in US buying to beat the tariffs could result in ‘trapped copper’ inside warehouses or ‘locked in financing agreements’, as opposed to being used productively by other potential buyers around the world.
Bailey said: ‘The result could be distorted physical markets, with those outside the US forced to compete for a shrinking pool of freely available copper.’
Nikos Tzabouras, senior market analyst at the Jefferies-owned Tradu investing platform, added: ‘US demand may taper once the import duty comes into effect, and uncertainty remains over the policy’s finer details.
‘Meanwhile, Trump’s broader trade agenda poses risks of a global economic slowdown, which could dampen consumption and trigger price corrections.
‘Furthermore, continued growth in AI-related investment is not assured in a challenging macroeconomic environment, and a rollback of clean energy incentives under Trump could impede the green transition.’
DIY INVESTING PLATFORMS
AJ Bell
AJ Bell
Easy investing and ready-made portfolios
Hargreaves Lansdown
Hargreaves Lansdown
Free fund dealing and investment ideas
interactive investor
interactive investor
Flat-fee investing from £4.99 per month
InvestEngine
InvestEngine
Account and trading fee-free ETF investing
Trading 212
Trading 212
Free share dealing and no account fee
Affiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence.
This article was originally published by a www.dailymail.co.uk . Read the Original article here. .