Falling FDI, soft US earnings weigh on commodities

Chinese base and precious metal futures stabilized Monday amid a mixed day for domestic commodities as Friday's drop in US stocks carried over into this week.

The most traded copper contract on the Shanghai Futures Exchange (SHFE) fell 0.98 percent to close at 57,890 yuan ($9,253) per ton. The January copper contract took all of its losses when the exchange opened, which indicates the influence of international markets Friday.

In terms of metals, those markets were negative Friday after China's foreign direct investment (FDI) and US company earnings disappointed, according to the commodity analyst team at the Australian bank ANZ.

China's FDI fell 6.8 percent year-on-year in September, coming in well below the market's expectations of a 3.5 percent drop, the analysts wrote Monday.

The drop coupled with mixed US corporate earnings so far this quarter weighed on investor sentiment, pushing down stocks in the US, which in turn took a toll on hard commodities like metals.

Still, the most active SHFE copper, zinc, aluminum and gold contracts traded flat Monday after their opening loss.

The benchmark three-month copper contract on the London Metal Exchange (LME) showed the same story, rising 0.2 percent by the time the Chinese mainland markets closed Monday.

Domestic soybean futures fared much better thanks to strong demand from China, Reuters reported. The most traded soybean contract on the Dalian Commodity Exchange rose 0.88 percent to close at 4,813 yuan per ton.