Copper prices rallied to a three-month high on Tuesday on increasing optimism about demand in China following strong manufacturing data, while the dollar weakened.

Copper prices at the London Metals Exchange rose 0.7% to $9935 a ton, after scaling March 27 highs at $9984.

A recent survey showed China’s factory activities grew in June, boosted by increasing orders after a month of contraction.

Also a weaker dollar boosted the greenback-denominated copper futures as they became cheaper to global traders.

Lower inventories also helped, with copper stocks falling at the London Exchange by 66% since mid February to 91,250 tons.

At the Shanghai Exchange, inventories fell 66% as well from early March levels to 81,550 tons.

The price premium between spot prices and three-month futures stood at $319 a ton last week, the highest since October 22, below falling to $120 on expectations of extensive deliveries. 

The Trump Factor

Continuous threats by US President Trump to impose tariffs on copper imports also served to boost prices at the COMEX exchange, boosting the US premium over London prices. 

As for other industrial metals: 

Aluminum rose 0.4% to $2608 a ton

Zinc fell 0.9% to $2727 

Lead was unchanged at $2044

Tin rose 0.4% to $33850

Nickel fell 0.2% to $15,185

Otherwise, the dollar index fell 0.2% as of 15:24 GMT to 96.7, with a session-high at 96.8, and a low at 96.3.

Copper September futures rose 1.9% in American trade as of 15:20 GMT to $5.18 a pound. 

Bitcoin fell below $107,000 on Tuesday, extending a mild correction from yesterday, but strong corporate demand remained on the cryptocurrency, underpinning it broadly. 

According to CryptoQuant data, bitcoin’s reserve at all major exchanges fell to 2.44 million units, the lowest since 2018, indicating that selling pressures declined.

MicroStrategy continued to grab headlines with its incredulous bitcoin purchases even as the cryptocurrency hits record highs. 

Through the X platform, MicroStrategy’s CEO Micheal Saylor announced a new purchase of 4980 bitcoins, raising the company’s totaling holdings to a new record high of 597,325 bitcoins, averaging $79,977 per unit, with a total value of $42.4 billion.

The purchase occurred between June 23 and 29, with the company spending $532 million in total, spending on average $106,801 per unit.

MicroStrategy has taken a strategy of heavy bitcoin investments since 2020 as a way to guard against inflation.

Saylor has seen a 64% return on his bitcoin investment in 2024, with this bold strategy raising eyebrows and drawing the admiration of many crypto investors.  

Japan’s MetaPlanet also expanded its bitcoin holdings by adding 1005 units worth $108.15 million, averaging $107,601 per unit. 

The company now owns 13,350 bitcoins in total, averaging $97,831 per unit, with a total value of $1.31 billion.

Bitcoin Stable in Third Quarter

A report by Bitfinex Alpha shows that bitcoin’s seasonal performance historically shows lower volatility in the third quarter, with historic return averages at mostly 6%.

Analysts believe that the technical foundation remains strong as long as the price respects the $94,000-$99,000 support, but it’ll need a strong stimulus for a new surge past recent record highs.

Approaching Correction?

Bitcoin’s supplies at profit status” surged from 87% to 98% last month according to Glassnode data, a historic percentage that could precede heavy profit-taking.

We saw that between January and April of this year, with bitcoin falling from $109,000 to $74,000 after the profiting supply percentage reached 98.8% on January 21.

Oil prices were little changed on Tuesday as investors assess the outlook that OPEC+ will announce a production hike for August at its next meeting, and amid ongoing US trade negotiations with major partners. 

Brent rose 5 cents to $66.79 a barrel as of 09:01 GMT, while US West Texas Intermediate rose 4 cents to $65.15.

Four OPEC+ sources told Reuters last week that the organization plans to raise output by 411 thousand bpd in August, after similar hikes for May, June, and July. 

Such a hike would raise total OPEC+ supplies in 2025 by 1.78 million bpd, almost 1.5% of global oil demand. 

Deal Anticipation 

Investors are also analyzing trade negotiations before US President Trump’s July 9 tariff deadline. 

US Treasury Secretary Scott Bessent that countries have received warnings of high future tariffs despite what he described as “good-intent negotiations”, adding that tariffs could return to between 11% and 50% after the temporary pause ends.

Otherwise, Morgan Stanley expects Brent to retreat to about $60 a barrel by early 2026 as geopolitical tensions recede and supplies surge.

The bank noted that the spike in prices above $80 a barrel during the Israel-Iran 12 day war was highly transient, with prices now falling to $67 a barrel after the ceasefire announcement. 

The bank expects strong oil supply growth from outside OPEC by about a million bpd in 2025 and 2026, enough to cover global demand growth.

The bank also expects a surplus of global supplies by 1.3 million bpd in 2026.

The US dollar fell on Tuesday against a basket of major rivals amid mounting concerns about the US fiscal situation following Trump’s big tax bill, and with uncertainty about the trade agreements. 

Investors are now betting on a faster pace of Fed rate cuts this year, while waiting for crucial US data this week, including the payrolls report on Friday. 

That led to a dollar selloff wave, which hit 10-year lows against the Swiss franc at 0.790, with a 0.64% drop against the yen at 143.08, with the yen closing the first half of the year with a 9% surge, its best performance since 2016.

The euro settled near four-year highs at 1.1781, with the common currency up 13.8% in the first half of the year, marking its best ever half-year performance. 

Sterling rose 0.2% to $1.3757, hovering near 3-⅕ year highs reached last week, while the dollar index hit February 2022 lows ar 96.6. 

Goldman Sachs now expects three Federal Reserve rate cuts this year, compared to previous estimates of just a single rate cut in December, citing the limited impact of tariffs and the softer labor market.

US President Donald Trump’s recent tax bill raised concerns about the financial stability of America, with ongoing uncertainty as well about US trade deals. 

Trump continued to pressure the Federal Reserve to cut interest rates, and sent Fed Chair Powell a list of interest rates by global central banks, saying that US rates should be between the 0.5% Japanese rate and the 1.75% Danish rate.

Investors are also monitoring the developments of US trade negotiations with major partners as the July 9 tariff deadline approaches with little progress so far.