Chicago 04/01/2016 - Copper prices tumbled to a two-week low as Chinese equities began the new year on a somber note following weak manufacturing data.
Copper for March delivery on the Comex division of the New York Mercantile Exchange sunk 5.55 cents, or 2.5 percent, to close at $2.0795 per pound. Trade ranged from $2.0690 to $2.1395.
The Chinese economy is failing to recover despite unprecedented government intervention, with December's Caixin manufacturing PMI coming in at 48.2, below the economic consensus of 48.9 and the 10th straight month of contraction.
In response, the Shenzhen Composite and Shanghai Composite tumbled 8.2 percent and 6.86 percent respectively. Authorities eventually halted trading and implemented a circuit breaker for the first time - part of an expanding government programme to curb 'malicious short-sellers'.
"Broadly, global equity prices follow Asia's early lead with industrial metals...weakened outlook tracking lower in overnight trading," a trader said.
"Base metals look to have many hurdles to face in 2016 with prices eating into cost curves and surpluses to erode, raising pressure [for] producer cutbacks," the trader added.
In geopolitical news, tensions are escalated between Saudi Arabia and Iran after a Shi'ite cleric was executed and Iranian protestors responded by attacking the Saudi Arabian embassy in Tehran on Sunday
Meanwhile in US data, Final Manufacturing PMI for December was 51.2, above the forecast of 51.1. ISM manufacturing PMI fared worse at 48.2, below economic consensus of 49.1.
US construction spending month-over-month in November and ISM manufacturing prices both disappointed and missed expectations at -0.4 percent and 33.5 respectively.
Turning to US markets, the Dow Jones industrial average and S&P were each down 2.3 percent, while the dollar was trading 0.3 percent stronger at $1.0828 against the euro.
In other commodities, light sweet crude (WTI) oil futures on the Nymex fell 30 cents or 0.8 percent to $36.74 per barrel, while the most-actively traded gold contract stood at $1,074.60 per ounce, up $14.40.
(Editing by Tom Jennemann)