Copper Sold, PMs Find Support on Euro Fears

Commodities are under pressure in European hours trade as markets respond to over-the-weekend news that Socialist candidate Francois Hollande beat incumbent Nicolas Sarkozy to become the next President of France. Traders are worried that the anti-austerity Hollande will unravel euro-zone debt crisis relief efforts, which like most EU policy have heavily relied on the Franco-German axis.

A failure by the mainstream pro-austerity Pasok and New Democracy (ND) parties to secure a joint parliamentary majority in Greek elections also held this weekend is compounding sovereign risk fears. Pasok and ND had previously signaled they were prepared to form a joint coalition, but now such an arrangement would require cajoling at least one currently anti-austerity junior member into the arrangement.

Growth-geared crude oil and copper prices are following stocks lower while gold and silver are under pressure as the US dollar rides haven demand higher. Losses in the precious metals space are very modest however as fears of a euro-zone-driven credit crisis akin to the events of 2008 boost the appeal of assets not necessarily reliant on well-functioning financial markets to maintain their value. A quiet economic calendar offers little to derail momentum and S&P 500 stock index futures are deeply in the red, hinting current trends are likely to carry forward as Wall Street comes on line.

COMEX E-Mini Copper (NY Close): $3.722 // -0.014 // -0.37%

Prices are testing support lines up at 3.713, with a break lower exposing rising trend line support set from October at 3.632. Initial resistance is found at a shorter-term rising trend line that formerly acted as support set from mid-March, now at 3.862.


Page 1 of 3 >>
comments powered by Disqus

Market Data

Sponsored By:
Check out Resource Investor - Polls on LockerDome on LockerDome