Investing.com - Copper prices plunged to the lowest level since July 2010 on Wednesday, amid ongoing concerns over the health of China’s economy.
The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
On the Comex division of the New York Mercantile Exchange, copper futures for May delivery tumbled to a session low of $2.908 a pound, the weakest level since July 2010.
Copper last traded at $2.917 a pound during European morning hours, down 1.2%, or $0.035 cents. The May copper contract lost 2.62%, or $0.079 cents, on Tuesday to settle at $2.952 a pound.
Futures were likely to find support at $2.844 a pound, the low from July 2010 and resistance at $3.057 a pound, the high from March 11.
Investors remained cautious after data released over the weekend showed that Chinese exports fell 18.1% on a year-over-year basis in February, confounding expectations for a 6.8% increase, following a rise of 10.6% in January.
The significant decline in China’s exports led to a deficit of $22.98 billion last month, compared to a surplus of $31.86 billion in January. Analysts had expected a surplus of $14.5 billion in February.
The downbeat data highlighted concerns about slowing growth in the world''s biggest consumer of the industrial metal.
In addition, there were concerns over the state of the country''s corporate sector. Investors remained jittery over signs of weakness in the bond market after last week''s default by Chinese solar company Chaori Shanghai Solar Energy Science & Technology Co.
On Wednesday, the focus was on Shanghai-based Baoding Tianwei Baobian Electric Co., a power equipment manufacturer for the new energy sector. Shares in the company sank more than 5% in Shanghai, while its corporate bond was suspended for a second day, after it reported a full-year net loss for the second consecutive year, which led to a delisting warning.
Concerns over domestic bond defaults stoked investor worries that financing deals that have locked up vast quantities of copper could unravel.
Elsewhere on the Comex, gold for April delivery rose 0.6% to trade at $1,355.00 a troy ounce, while silver for May delivery picked up 0.05% to trade at $20.82 a troy ounce.
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