Looking to the Futures

Copper futures (/HG) have spent much of the summer consolidating, caught between longer-term demand optimism and near-term macroeconomic uncertainty.

After trading primarily in a $6.00 to $6.60 per pound range, “Dr. Copper” remains an important economic bellwether, but the metal is also taking on a larger role as a gauge of the buildout in power-hungry technologies.

Demand tied to artificial intelligence (AI) data centers, electric vehicle (EV) growth, and grid modernization continues to support the bullish case, while traders are watching to see whether tightening inventories and slow-moving mine supply can eventually push prices above the recent range.

The rise of AI has changed the copper demand story. High-performance computing requires large amounts of electricity, and that power has to move through transformers, cables, switches, busbars, and cooling systems that rely heavily on copper.

That demand growth is running into a supply side that has been slow to respond. Years of underinvestment, long permitting timelines, declining ore grades, and higher production costs have limited the industry’s ability to quickly bring new copper supply to market.

Because new mines can take years to develop after approval, the market remains sensitive to any disruption at major operations in South America, Africa, or other key producing regions.

For now, that creates a market where even modest supply issues can have an outsized impact, especially if demand from data centers, electrification, and grid upgrades continues to grow.

Policy and global growth remain important swing factors. Potential U.S. tariffs on refined copper imports could encourage some domestic users to pull supply forward, while high prices may test demand from industrial buyers in China, the world’s largest refined copper consumer. If Chinese manufacturers slow purchases because of elevated prices, that could become a bearish catalyst and help ease the supply-demand imbalance that has recently favored copper bulls.

This morning, U.S. stock index futures moved higher in the early hours with the S&P 500® (+0.20%), the Nasdaq-100® (+0.76%), the Russell 2000® (+0.12%), and Dow Jones Industrial Average® (+0.66%) all in the green.

In Asia, major indexes closed mixed, with the Nikkei (+0.32%) and the Shanghai (+0.33%) higher, but the Hang Seng (–0.60%) posting losses. 

European trading saw the DAX (+0.60%), the CAC (+0.08%), and the FTSE (+0.31%) markets move higher by midday.

Crude Oil futures (/CLU26) started the week sharply lower (–5.11%), as front-month WTI futures briefly moved back below $80 per barrel. The sell-off came after the U.S. called off planned strikes on Iran and signaled that negotiations with Tehran would begin, easing some of the geopolitical risk premium that had been built into crude prices. While the potential for disruption around the Strait of Hormuz remains a key market risk, traders appeared to shift their focus back toward supply expectations and whether diplomacy can keep barrels moving through a critical global energy corridor.

Japanese Yen futures (/6JU26) finished Monday’s session sharply higher (+1.39%), pushing the yen to three-month highs against the U.S. dollar. The move followed a joint U.S.-Japan effort to buy yen and sell dollars, marking the first coordinated intervention of its kind since 1998. The action helped lift the yen from multi-decade lows and put currency traders on alert for additional intervention if Japanese officials continue to signal concern over the pace of yen weakness.

Soybean futures (/ZSX26) closed higher Monday (+0.40%), reversing early session losses after reports that China’s state-run trading companies purchased U.S. soybeans late last week. Initial estimates put the recent sales at roughly 1 million metric tons, helping ease concerns about export demand and giving the market a boost after a softer start. Traders will likely continue to watch for confirmation of additional Chinese buying, as fresh export interest could help support prices during a key stretch for U.S. crop development and global demand expectations.

Major economic reports, trading events, and news items that could potentially impact specific futures markets:

Trade Balance for June (interest rates)

JOLTs Job Openings and Quits for June (interest rates)

Factory Orders for June (interest rates)

RCM/TIPP Economic Optimism Index for Aug (interest rates)

Futures last trading day: July Milk

6- and 52-week T-bills 

New futures products are available to trade with a futures-approved account on all thinkorswim platforms: 

• Ripple (/XRP)
• Micro Ripple (/MXP)
• 100 OZ Silver (/SIC)
• 1 OZ Gold (/1OZ)
• Solana (/SOL)
• Micro Solana (/MSL)

Visit the Schwab.com Futures Markets page to explore the wide variety of futures contracts available for trading through Charles Schwab Futures and Forex LLC.