METALS-Copper tumbles as Trump victory sparks fear of slower energy transition

(Updates prices) By Julian Luk London Nov 6 (Reuters) - Copper prices tumbled on Wednesday as victory for Republican Donald Trump in the U.S. presidential election spurred concerns that major electrification initiatives would be rolled back, dampening demand for the highly conductive metal. Three-month copper on the London Metal Exchange (LME) CMCU3 was down 3.8% to $9,365 per metric ton at 1653 GMT. It is set to post the biggest intraday loss in five months. It fell through the 21-day, 50-day and 100-day moving averages. Prices in rival bourse Chicago Mercantile Exchange (Comex) fell even further. The most traded front-month copper contract lost 4.7% to $4.2405 per pound. HGc1 The copper market is pricing in the long-term direction of Trump's policies, a trader said. Trump said he would "rescind all unspent funds" under the Inflation Reduction Act (IRA), the Biden-Harris administration's signature climate law to decouple the global supply chain from China. The IRA includes hundreds of billions of dollars in subsidies for electric vehicles, solar and wind energy, and increasing production of strategic minerals. It was seen as an incentive boost for investments in lithium, copper and nickel outside China. A Trump victory could also derail U.S. policy in resource-rich Africa. Biden's administration planned to nearly double its financial commitments in the copper belt of the Democratic Republic of Congo, the world's second biggest copper producer. To encourage local manufacturing, the president-elect has also threatened to add a 60% blanket tariff on U.S. imports of Chinese goods. That could quicken factory relocation out of China, which smelts almost half of the world's copper. "If everything got derailed, it's time for us to re-evaluate the copper demand-supply expectations," the trader said. For other metals, zinc CMZN3 lost 4.1% to $2,978 to be the worst performer of the base metals complex. The galvanising metal prices declined as China's steel industries could face headwinds as Trump pledged to boost local U.S. manufacturing. Zinc's sister metal lead, widely used in lead-acid batteries, however, held up well. It rose 0.8% to $2,043.5. "The perception is that US conventional cars will now get a renewed 'lease on life' given that EV mandates - at least on the federal side - will fade. " Ed Meir, consultant at brokerage Marex said. Lead batteries are still the most common type of battery found in cars and vans. LME aluminium CMAL3 dropped 1.7% to $2,614 a ton, nickel CMNI3 rose 0.2% to $16,150, and tin CMSN3 was down 3% to $31,380. Pressuring metal prices was a stronger dollar. The dollar index =USD rallied 1.6% and was set for its best day since September 2022. Investors returned to so-called "Trump trades", making dollar-priced metals more expensive for other currency holders. (Reporting by Julian Luk; Editing by Sharon Singleton, Mark Potter and Louise Heavens) (([email protected])) (( For related news and prices, click on the codes in brackets: LME price overview RING= COMEX copper futures 0#HG: All metals news MTL All commodities news C Foreign exchange rates FX= SPEED GUIDES LME/INDEX ))