Copper's biggest rally in almost a decade is being greeted by a growing chorus of skeptics.
The metal is up 18 percent since Dec. 31 -- the best start to any year since 2009. But analysts at Natixis SA and Bank of America Merrill Lynch say the ride down could be just as fast as the way up. They point to a handful of indicators that suggest markets are out of sync with the fundamentals, and Barclays PLC predicted losses later this year for a market that it said was "overhyped."
As recently as early May, prices on the London Metal Exchange were down for the year, until buoyant Chinese demand and labor problems at some of the world's biggest mines sparked a rebound. As the rally gained momentum, speculators piled in like never before.
"The risk of a correction is there in all metals, but copper is the one that stands out the most," Michael Widmer, a metals strategist at Bank of America, said by phone from London.
On Wednesday, futures on the Comex in New York were at $2.99 a pound.
Business on 08/24/2017