Copper rose the most in a month as equity markets rebounded and the dollar weakened, boosting prospects for the industrial metal.
The MSCI World Index of shares advanced for the first time in six days, and futures indicated that US equity benchmarks would gain when trading begins. The dollar fell as much as 0.6 per cent against a basket of six major currencies, making dollar- denominated commodities more attractive. The Reuters/Jefferies CRB Index of 19 raw materials rebounded from a six-day slump.
“We’re seeing a very strong correlation of copper with stock markets,” Andrey Kryuchenkov, an analyst at VTB Capital in London, said on Thursday by telephone.
Copper futures for December delivery rose 8.1 cents, or 2.5 per cent, to $3.3125 a pound at 8:37 am on the Comex in New York. A close at that price would mark the biggest gain for a most-active contract since July 21.
Yesterday, the metal closed above the 200-day moving average of $3.2213, after touching $3.20, the lowest level July 28. This is a “significant” price action that “attracted follow-through buying overnight out of China and India,” Alex Heath, the head of London Metal Exchange trading at RBC Capital Markets in London, said in a daily report.
Copper for delivery in three months jumped $166.50, or 2.3 per cent, to $7,267.50 a tonne ($3.30 a pound) on the LME. Aluminum, zinc, lead, tin and nickel also gained.
Aluminium was trading at $2,024 a tonne $2,003.
Traders are watching a premium of around $7 a tonne on LME aluminium to be delivered on Friday and bought back on Monday -- known as the tom/next and used to lend metal to entities that are short.
