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Copper, Oil Expected to Take Lead from China Tuesday

Chinese GDP, industrial production and retail sales data is likely to have the most impact Tuesday on the direction of key commodities like copper and crude as well as equities, traders say.

Seen as the primary driver of future demand for crude oil and copper, traders Monday were waiting to see how far and how fast China's economy may have slowed in the third quarter. While China's GDP is expected to have reached over 9 percent last quarter, it is also expected to have slowed from the 9.7 percent growth in the first quarter and 9.5 percent growth in the second quarter.

Nymex crude settled slightly lower Monday at $86.38 per barrel. The front month contract has been lower three of the past four sessions. Copper was nearly a percent lower at $3.37 per pound.

Last week's disappointing trade data from China may have been a warning sign, traders say. Add to that the sharp 12 percent year-over-year decline in crude oil imports in September. This recent data "raises concern over the possibility that economic weakness is developing in China," says MF Global energy analyst Tom Pawlicki.

Watching the performance of Brent crude and copper may foreshadow what lies ahead for equity prices as well, says trader Dennis Gartman, a CNBC contributor. All three have been trading nearly in lock-step for the past month.

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  • Patti Domm

    Patti Domm is CNBC Executive Editor, News, responsible for news coverage of the markets and economy.

  • A CNBC reporter since 1990, Bob Pisani covers Wall Street from the floor of the New York Stock Exchange.

  • CNBC Senior Commodities Correspondent and Personal Finance Correspondent

  • JeeYeon Park is a writer for CNBC.com. Follow her on Twitter: @JeeYeonParkCNBC

  • Rick Santelli joined CNBC Business News as an on-air editor in 1999, reporting live from the floor of the Chicago Board of Trade.

  • Senior Producer at CNBC's Breaking News Desk.