Chinese real estate company Evergrande’s fear of insolvency was also reflected in the commodities market on Monday. Experts believe that a bailout of the heavily indebted company by the Beijing government is unlikely. The price of copper fell as much as three percent to $ 9,053 per tonne. “If Evergrande collapses, a lot of real estate projects would be canceled,” said commodity expert Malcolm Freeman of brokerage firm Kingdom Futures. This would considerably dampen the demand for industrial metals. Copper is used, among other things, for electric cables and water pipes.
The price of oil has also accelerated its fall. US WTI light crude fell 1.5% to $ 70.92 per barrel (159 liters). Oil production in the Gulf of Mexico is back on track after Cyclone Ida, according to Carsten Fritsch, analyst at Commerzbank. The fear of a collapse of Evergrande pushes investors towards the US currency “safe”. The appreciation of the dollar makes commodities less attractive to investors outside the United States.
The euro fell as a result. Common currency costs 0.1% less at $ 1.1715. In addition, currency investors are banking on a tightening of US monetary policy. The US Federal Reserve announced the results of its monetary policy meeting on Wednesday. In the wake of the price losses in the stock markets, the two most important cryptocurrencies have also lost considerably. Bitcoin lost more than seven percent to $ 43,768, while Ethereum fell almost ten percent to $ 3,044.
Besides the dollar, bonds were also sought after as a safe haven by investors. This pushed the yield on ten-year stocks in Germany and the United States to minus 0.333 and above 1.333 percent, respectively.