Copper Prices Drop Amid US Midterm AI Concerns
Copper prices hit their steepest weekly decline since March as US midterm results spark fears that increased regulation will hinder AI and data center expansion.
Copper prices fell on Friday, marking the steepest weekly decline since March. Benchmark three-month copper on the London Metal Exchange dropped between 0.8% and 1.3%, while the most-traded contract on the Shanghai Futures Exchange fell 1.08%.
The price decline follows Democratic wins in the United States midterms, which triggered a rout in technology stocks. Market participants expressed concern that increased regulatory oversight could limit artificial intelligence buildouts and the expansion of data centers, reducing the projected demand for copper.
Despite the downward price pressure, physical supply constraints have limited the fall. Copper stocks in Shanghai Futures Exchange warehouses plummeted over 24% this week to 33,848 tons, the lowest level in nearly three years. Additionally, the Yangshan copper premium reached a record high of $210 a ton, indicating strong demand for imports into China.
