Trade war weakens market expectations Copper prices are not bullish on a big rise in the short term

The escalation of the Sino-US trade war coincides with the poor performance of China's economic data, and it is not the current fundamentals that affect market trading, but the fundamentals
of half a year or more.
The trade war does not weaken demand immediately, but it gives the market an expectation of future weakness, and expectations are well ahead
of reality.

Copper prices fell sharply because copper prices are at the end of the copper cost curve, and the cost difference between the mines at the end is very large, resulting in an extremely steep cost curve at the end
.
When the market expects a decline in demand in the future, copper prices fall
sharply due to the steep cost curve, and the corresponding copper mine costs will be significantly reduced after the demand decline.

At present, trade war fears have eased
due to the lifting of sanctions against ZTE and the passage of bills in the US Senate aimed at giving Congress more say in trade penalties imposed in the name of national security.
But pay attention to the introduction
of China's trade measures with the United States.

Due to the tightening of the approval authority of the monetization of shed reform and the continuous tightening of real estate regulation in many places, the market is worried that the increase in nonferrous demand is still suppressed to a certain extent, and the nonferrous demand side is facing certain pressure
.

On the economic front, although China's June CPI was unchanged from expectations and slightly higher than the previous value, the CPI still fell slightly by 0.
1% month-on-month, which is also the fourth consecutive month of month-on-month decline
.
After a month-on-month increase in May, PPI rose another 0.
3%
month-on-month this month.
Combined with the earlier announcement that domestic investment was less than expected, and consumption fell more than expected, it also affected the market bullishness
.

With the advancement of labor negotiations at the Escondida copper mine, the possibility of a strike is getting lower and lower, while TC continues to rise, copper price support is still gradually weakening, not optimistic about a big rise in the short term, may enter the shock range
.