Copper prices declined by 0.23% to close at Rs 1,337.6, as investors weighed the reduction in geopolitical tensions in the Middle East against apprehensions regarding deteriorating economic indicators from China. Market sentiment showed signs of improvement following reports indicating that the United States and Iran have reached a preliminary agreement intended to resolve the conflict and facilitate the reopening of the Strait of Hormuz. The resulting decline in oil prices alleviated concerns regarding inflation and aggressive monetary tightening, thereby offering some support to industrial metals.

However, softer Chinese retail sales data and broader concerns regarding demand growth constrained the upward movement in copper prices. Underlying market fundamentals continued to exhibit a relatively supportive stance. Ongoing speculation about possible U.S. tariffs on refined copper has resulted in a premium for the metal within the United States, which in turn has stimulated imports and constrained supply availability in other areas. Furthermore, China’s central bank has directed commercial banks to enhance their lending activities, underscoring Beijing’s persistent initiatives to bolster economic growth and infrastructure investment.

China’s copper demand continues to exhibit resilience, bolstered by significant investment in power grid initiatives, which experienced a 37% increase compared to the same period last year during the first quarter. Unwrought copper imports rose by 3.2% year-on-year in April, reaching a seven-month peak, even in the context of unprecedented domestic refined copper output. Supply-side developments persist in shaping the market outlook. Goldman Sachs and Citi have both elevated their medium-term projections for copper prices, attributing this adjustment to constrained growth in mine supply, increased U.S. imports, and ongoing global supply shortages. Meanwhile, concerns persist regarding production limitations at significant mining operations, such as Grasberg and Kamoa-Kakula.

While the International Copper Study Group anticipates a surplus in the global refined copper market for 2026 and 2027, the combination of slower mine output growth and ongoing geopolitical uncertainties continues to bolster prices. Technically, the market is experiencing long liquidation, as evidenced by a 4.54% decline in open interest alongside a decrease in prices. Copper has immediate support at Rs 1,330.6, followed by Rs 1,323.6. Resistance is identified at Rs 1,342.3, and a breakout above this threshold may lead to further gains towards Rs 1,347.