By Yi Tian and Agnieszka Troszkiewicz - Sep 10, 2011 1:04 AM GMT+0700
Copper tumbled the most in a month as President Barack Obama and Federal Reserve Chairman Ben S. Bernanke failed to boost investor confidence in the economy.
Global equities dropped as Bernanke stopped short of detailing new plans to boost growth in the world’s largest economy in a speech yesterday, making no reference to further asset purchases by the central bank. Obama called on Congress to pass a plan that would inject $447 billion into the economy. The U.S. is the world’s biggest copper consumer after China.
“Obama’s plan is just not convincing enough,” Matthew Zeman, a strategist at Kingsview Financial in Chicago, said in a telephone interview. “Bernanke also disappointed investors. A lot of risk assets are lower. We will have more downside in the copper market.”
Copper futures for December delivery declined 14.1 cents, or 3.4 percent, to close at $4.0025 a pound at 1 p.m. on the Comex in New York, the biggest loss since Aug. 8. The metal slumped 3 percent for the week, the first decline in three weeks.
“There is residual disappointment in the market that QE3 has not been announced,” Stephen Briggs, an analyst at BNP Paribas SA in London, said by telephone today, referring to a third round of so-called quantitative easing. The “Obama job proposal was not earth-shattering, so perhaps slight disappointment there.”
On the London Metal Exchange, copper for delivery in three months dropped $294, or 3.2 percent, to $8,821 a metric ton ($4 a pound).
Aluminum, nickel, zinc, tin and lead also fell.
To contact the reporters on this story: Yi Tian in New York at ytian8@bloomberg.net; Agnieszka Troszkiewicz in London at atroszkiewic@bloomberg.net
To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net
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