Copper hits 3-week low on stronger dollar as Middle East war intensifies

London copper steadied after earlier easing to a three-week low on Tuesday, pressured by a firmer dollar amid simmering tensions in the Middle East and concerns over a global economic slowdown. The benchmark three-month copper on the London Metal Exchange was steady at $12,996 per metric ton by 0731 GMT, after hitting its lowest level since April 13 earlier in the day. Trading activity was muted, with the Shanghai Futures Exchange closed for the Labour Day holiday. Trading will resume on Wednesday. The U.S. and Iran launched new attacks in the Gulf on Monday as they wrestled for control over the Strait of Hormuz with duelling maritime blockades. It came not long after U.S. President Donald Trump launched a new effort to get stranded tankers and other ships through the vital energy-trade chokepoint. The U.S. said it had destroyed six small Iranian military boats, while an oil port in the United Arab Emirates, which hosts a large U.S. military base, was set ablaze by Iranian missiles. "It seems to be less of an individual sector (theme) and more of an increasingly macro focus on essentially what is now an indefinite bottleneck in Hormuz and its inflationary consequences," said Ilya Spivak, head of global macro at Tastylive, adding that a firmer dollar was further pressuring copper prices. The U.S. dollar rose on safe-haven demand amid ongoing Middle East tensions. Stocks in Asia slid while oil prices eased but remained well above $100 a barrel, as the U.S. and Iran continued to work towards a truce while trading blows over the strait. Two people were killed and five others injured in an explosion at the Kazzinc plant, Kazakhstan's largest zinc production facility owned by Glencore, the company said on Tuesday. Among other LME metals, aluminium held steady, nickel gained 0.7%, lead was up 0.5%, tin inched up 0.1%, and zinc rose 0.6%.