U.S. Initial Jobless Claims Rise, Cooling Rate Cut Expectations and Impacting Copper Market Trends

Recent U.S. economic data revealed that initial jobless claims for the past week were slightly higher than anticipated, coming in at 238,000. This unexpected increase indicates a continued slowdown in the job market, which in turn has influenced market expectations regarding potential interest rate cuts by the Federal Reserve. Additionally, the latest figures from the Philadelphia Fed Manufacturing Index and copper inventories further complicate the market outlook.

Key Economic Data and Market Reactions

Initial Jobless Claims:
- Jobless Claims Rise: The number of initial jobless claims last week was 238,000, slightly above market expectations, suggesting a cooling job market.
- Interest Rate Expectations: The higher-than-expected jobless claims boost market expectations for potential interest rate cuts, as the Federal Reserve may seek to support economic activity.

Philadelphia Fed Manufacturing Index:
- Underperformance: The Philadelphia Fed Manufacturing Index for June significantly missed expectations, indicating substantial cooling pressures on the manufacturing sector.

Impact on Copper Market

Copper Inventories:
- Shanghai Futures Exchange (SHFE): The SHFE reported a destocking of 7,843 tons, bringing total copper inventories down to 322,900 tons.
- London Metal Exchange (LME): The LME saw a more pronounced destocking of 100,000 tons, reducing inventories to 165,000 tons.
- SMM Electrolytic Copper Spot Discount: The spot discount for SMM electrolytic copper ranged from 200 to 300 yuan, indicating subdued industrial demand.
- Yangshan Copper Premium: The Yangshan copper premium remains negative, reflecting cooling industrial demand and pressures on copper prices.

Short-Term Outlook for Copper Prices:
- Cooling Economic Pressure: While the easing of overseas economic data has tempered the Fed's hawkish stance on interest rate cuts, cooling pressures on the economy have not been fully absorbed by the market.
- Price Movement: Market analysts predict that copper prices may continue to decline in the short term due to the combined effects of cooling demand, higher jobless claims, and manufacturing slumps.