Copper Hits Record Close as AI Data Center Demand Drives Rally; Citi Sets $15,000 Bull-Case Target

Copper prices closed at a back-to-back record high on Tuesday, with AI data center demand and strategic inventory stockpiling fueling a rally that has pushed the metal up 14.9% year to date, according to market data.

Copper's July-dated futures settled up 1.09% to 6.531 on Tuesday, then touched a further intraday high after the close. On the London Metal Exchange, copper added 0.56% to $14,021 per metric ton — also a record close.

Citi strategist Charlie Massy-Collier attributed the move to structural demand tied to artificial intelligence infrastructure and the broader energy transition. "Practically all copper demand growth since 2022 has come from energy transition and AI related sources," Massy-Collier wrote in a note to clients on Monday.

Massy-Collier also cited a newer demand channel: strategic inventory stockpiling. "Citi specialists have mapped out potential price implications of strategic inventory build scenarios," the note said.

The strategist acknowledged earlier hesitation about entering the trade at elevated levels, saying resistance at the $13,500 threshold had given the bank pause. With copper now clearing that level, Massy-Collier said the move signals broader market confidence. "Our interpretation of the recent break above $13,500 is one of the market confirming the strength of both the structural and cyclical demand setup, giving us conviction to chase the move higher," he said.

Citi's bull-case forecast stands at $15,000 per metric ton — roughly 7% above Tuesday's close. The bank is implementing the trade through a purchase of an LME copper digital call option at 15,250, expiring August 5.

Copper prices have also risen 7.8% since the start of the Iran war, which has contributed to broader commodity market volatility.

The record copper close arrived on a turbulent day for technology and semiconductor stocks, which sold off sharply after a hotter-than-expected consumer inflation reading sent investors into risk-off mode. Qualcomm fell more than 11% — its worst single-session decline since 2020 — while Intel dropped 7%, Marvell Technology lost about 4%, and the iShares Semiconductor ETF sank 3%.

The chip sector pullback follows a sustained rally that had broadened the AI trade well beyond Nvidia, lifting CPU and memory chip makers on bets that the transition from AI model training to agentic applications would sustain demand. Sandisk, whose shares have climbed more than sixfold since the start of the year, fell 6% on Tuesday. Micron Technology dropped about 4%.

Meanwhile, at the Sohn Investment Conference in New York, Greenlight Capital founder David Einhorn pitched five companies he described as turnaround candidates, several with direct AI exposure. Among them was Centene, a health insurer Einhorn said could automate claims processing through AI — potentially lifting margins that were compressed in 2025 by rising medical costs. Applying a 10 to 12 times earnings multiple, he put fair value for Centene between $85 and $102 per share, against a current price of roughly $56.

Einhorn also highlighted industrial construction firm Fluor as a beneficiary of U.S. capital spending on data centers, pharmaceutical facilities, LNG infrastructure, nuclear power, and copper mining. He said Fluor shares could reach $115 within several years if the company completes its buyback program.

The dual narratives — copper's record run and the chip sector's single-session reversal — underscore how AI-driven infrastructure spending is reshaping demand across asset classes, even as near-term macroeconomic pressures, including inflation and the Iran conflict, introduce volatility into markets that had reached historic highs.

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