Copper climbed to a nine-month high and aluminium gained the most in eight months in London on speculation economic data is pointing to a pick-up in demand for industrial metals used in construction.
German consumer confidence rose for a third month on signs the economy is starting to recover. Sales of new US homes probably climbed in June to the highest level in four months, adding to evidence the housing slump that began in 2005 is stabilising, economists said before a report on Monday.
“Sentiment in the base metals sector is currently quite good,” Eliane Tanner, an analyst at Credit Suisse Group AG in Zurich, said. “More and more commodity markets will see positive demand growth numbers again in the months ahead.”
London Metal Exchange copper for delivery in three months rose $113, or 2.1 per cent, to $5,635 a tonne, by 10.47 am local time. Earlier it reached $5,646, the most since October 8. Last week the contract climbed 4 per cent.
Aluminium for delivery in three months climbed to $1,844 a tonne, the highest intraday price since November 20.
Copper futures for September delivery rose 2 per cent to $2.572 a pound on the New York Mercantile Exchange’s Comex division.
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Hedge-fund managers and other large speculators decreased their net-short position, or bets prices will fall, in New York copper futures in the week ended July 21, according to US Commodity Futures Trading Commission data. Net-short positions fell by 4,077 contracts, or 20 per cent, from a week earlier, it said.
“This is reflecting the improved sentiment in the market,” Credit Suisse’s Tanner said. Stockpiles of aluminium rose 1,950 tonnes to about 4.6 million tonnes, almost the double since the start of the year, LME data today showed.