Most base metals retreated after racking up a second weekly gain on China’s moves to ease stress in its struggling property market.
(Bloomberg) — Most base metals retreated after racking up a second weekly gain on China’s moves to ease stress in its struggling property market.
Copper drifted lower on the London Metal Exchange even as Chinese stocks jumped after the announcement of new property support measures, the latest in an intensifying campaign to rescue a beleaguered sector that’s dragging down the economy. Prices for aluminum and nickel also moved lower.
Investors are assessing how Beijing’s steps — including cutting down-payments and lowering rates on existing mortgages — will feed through to real estate activity. Copper is used extensively in construction and manufacturing, and massive amounts will be needed to wire the shift to green energy.
Meanwhile, the clock is ticking on Chinese developer Country Garden Holdings Co. to avoid what would be its first default. The builder with about $187 billion of total liabilities — making it among the most-indebted property firms in the world — must pay $22.5 million in dollar note interest before Sept. 5-6.
China is taking bigger steps to support the housing market after a slew of piecemeal measures failed to halt a slide. Home sales soared in the biggest cities over the weekend following the relaxation of mortgage rules, according to local media Monday.
LME copper traded 0.8% lower at $8,436 a ton as of 11:14 a.m. local time, while aluminum, nickel and lead all lost more than 1%. Zinc and tin were little changed.
The LMEX Index of six base metals climbed 1.4% on Friday to reach the highest since Aug. 4.
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