{"id":58799,"title":"Metals stocks slump as copper tariff hopes fade and Fed rate hike odds rise","publisher":"Stockmark.IT","author":"Stockmark.IT Website","published":"2026-09-11T06:13:56+00:00","modified":"2026-09-11T06:13:56+00:00","canonical_url":"https://stockmark.it/mining-stocks-rally-comes-to-abrupt-halt-as-copper-silver-prices-plumm/","markdown_url":"https://stockmark.it/mining-stocks-rally-comes-to-abrupt-halt-as-copper-silver-prices-plumm.md","json_url":"https://stockmark.it/mining-stocks-rally-comes-to-abrupt-halt-as-copper-silver-prices-plumm.json","category":"Business","categories":["Business","Stockmarket"],"featured_image":"https://i0.wp.com/stockmark.it/wp-content/uploads/2026/09/metals-stocks-slump-as-copper-tariff-hopes-fade-and-fed-rate.png?fit=1536%2C1024&quality=80&ssl=1","format":"news","language":"en-GB","content":"Metals and mining equities experienced a sharp decline on Thursday following a US producer price report and sustained crude oil prices above $105 a barrel. These factors increased the market probability of a Federal Reserve interest rate increase next week to approximately 70 percent. Simultaneously, reports indicating that the White House copper tariff plan has stalled removed a key support from a metal that had previously set records for four consecutive sessions.\n\nComex copper for December delivery fell as much as 5.4 percent to $6.5160 a pound in New York, reversing a day earlier settlement at a record $6.8885. In early afternoon trade, the price stood at $6.5220, representing a 5.3 percent drop. Comex gold for December delivery dropped as much as 2.1 percent to $4,365.40 an ounce before paring losses to 1.6 percent at $4,391.00. December silver slid as much as 6.1 percent to $64.455, closing at $64.575, down 5.9 percent. Platinum and palladium each lost more than 6 percent in value.\n\nThe decline in copper prices followed a Reuters report stating that the White House has not decided on refined copper tariffs. Officials are weighing the risk of higher manufacturing costs ahead of November’s midterm elections. This uncertainty has unsettled a market where traders had spent the year moving metal into US warehouses. Hedge funds remain heavily long, and the metal’s correlation with the S&P 500 sits at multidecade highs, leaving little cushion when the tariff premium wobbles. Gold came under pressure from Brent crude spiking on rising tensions in the Middle East. Swap traders lifted the probability of a September hike from roughly 60 percent earlier in the day, with consumer price figures on Friday being the last major release before the Fed meets. Silver, which had outperformed gold in August, fell more than four times as far as bullion. Platinum and palladium also declined as the dollar and Treasury yields firmed after the data.\n\nFreeport-McMoRan, the largest listed copper producer, was down over 7 percent in early afternoon trade in New York. The 15 million shares that had changed hands by then already exceeded a full day’s average volume over the past two weeks. The drop cut Freeport’s market value to $101.7 billion, and another 2 percent decline would take it back below the $100 billion mark it crossed in the August rally for the first time. Teck Resources was also trading at a day’s normal volume before the lunch hour, down more than 6 percent. Southern Copper fell by a similar margin, wiping over $10 billion from the Mexican company. Antofagasta lost 7 percent in over-the-counter trade, while Anglo American, Lundin Mining and First Quantum all fell more than 6 percent. Ivanhoe Mines gave back 5 percent after a 17 percent run over the past week on the expansion of its Makoko discovery in the DRC. The diversified majors were also affected, with BHP falling 6 percent in New York and Rio Tinto dropping more than 4 percent.\n\nThe selloff lands on a sector coming off its best month on record. The August rally added $357 billion to the value of the world’s 50 biggest miners, the largest monthly gain ever, as gold rose about 10 percent and copper pushed toward $7 a pound on the US tariff trade. According to a Reuters report, the White House has yet to decide on duties for refined copper. Two people familiar with the matter said the administration is increasingly focused on affordability as Republicans face pressure to show their policies are lowering costs rather than raising them. A White House official confirmed the Commerce Department delivered its update by the June 30 deadline and said the administration continues to evaluate all options to reshore copper and other critical manufacturing back to the United States. This is some way short of the 15 percent tariff from January 2027, rising to 30 percent in 2028, that Commerce Secretary Howard Lutnick was asked to consider.\n\nThe episode echoes 2025, when the market braced for a blanket tariff on everything containing copper and Trump settled in July that year for levies on pipes, wiring and other semi-finished products. In the meantime, the trade has pulled a record 695,624 tonnes into Comex warehouses, more than double what is left in LME and Shanghai sheds combined. Jacob White, minerals analyst at Sprott Asset Management, said that as long as tariff policy remains unresolved, that possibility reduces the incentive to return metal to international markets. US refined copper imports have risen 16-fold since 2015 while domestic production slipped 20 percent, according to the US Geological Survey, and the country has only two operating smelters, owned by Freeport and Rio Tinto.\n\nWorld mine production fell 1.1 percent in the first half of 2026, according to the International Copper Study Group. Chile was down 6.6 percent, Indonesian concentrate output was down 32 percent while Grasberg remains constrained, and the DRC’s concentrate production was off 34 percent after the seismic damage at Kamoa-Kakula. Morgan Stanley, which began the year expecting mine supply to grow, now sees it flat to slightly lower. This would make 2026 the first year of falling mine output since 2017, the consequence of investment cuts a decade ago and a project pipeline that analyst Amy Gower says is unlikely to add much before 2030. Collahuasi restarting its mothballed leaching plant for 6,000 tonnes of cathode a year is the scale of response high prices are drawing so far.\n\nSilver’s 5.5 percent drop is its worst session since June and leaves the metal 6 percent below where it ended a 20 percent surge inside three weeks in August. The metal is down 9 percent in 2026 after touching $121.64 in January. The gold miners were spared the worst. Newmont fell less than 2 percent holding its value at $132 billion, while Agnico Eagle slipped nearly 3 percent, enough to nudge it below the threshold it has straddled all month. Equinox Gold and AngloGold Ashanti led the gold group lower with 4 percent declines, matching declines at Kinross Gold and Pan American Silver. The royalty and streaming companies also succumbed to the weakness.\n\nGold has been pinned in a range either side of $4,400 for most of September as traders weigh the Fed outlook. This follows a surge of about 10 percent in August on the so-called debasement trade, the view that efforts to hold down US borrowing costs in the face of swollen deficits would gradually erode the value of the dollar. That trade took a knock on Wednesday when the Treasury announced plans to buy back up to $6 billion of longer-dated debt, well short of what markets had hoped for, and long bonds kept selling off. UBS strategist Joni Teves wrote in a note cited by Bloomberg that a September hike would generate a knee-jerk correction, but not derail the broader recovery. Renisha Chainani, chief research officer at Mumbai bullion trader Augmont Enterprises, expects gold to trade between $4,300 and $4,500 for now, favouring a buy-the-dip, sell-the-rally approach.\n\nThursday’s drop leaves copper up 16 percent in 2026 and about 5 percent below Wednesday’s record settlement, while gold is up 2 percent for the year and 19 percent below its January record close of $5,419. Ghana ordered miners to shift surface operations to Ghanaian-owned contractors, but mine workers have spoken out against it. Production at Escondida slumped 22.1 percent to 89,400 tons, and output at Collahuasi rose 12.3 percent to 38,400 tons."}