Copper climbed to trade near its highest price in almost 27 months as U.S. employment data added to signs the Federal Reserve may expand credit-easing measures to spur growth, weakening the dollar and boosting demand for alternative assets. Tin and nickel also advanced.
Copper for delivery in three months on the London Metal Exchange rose as much as 0.5 percent to $8,300 a metric ton and traded at $8,296 by 11:26 a.m. in Singapore. The metal climbed to $8,326 a ton yesterday, the highest price since July 2008. Copper futures for December delivery in New York gained 0.6 percent to $3.7755 a pound. The Shanghai Futures Exchange will re-open tomorrow after the National Day holiday.
Base metals prices are supported by a weaker U.S. dollar, “as markets continue to digest central banks’ current appetite for quantitative easing,” Commonwealth Bank of Australia analyst Lachlan Shaw wrote in an e-mail today.
The dollar was little changed against a basket of six major currencies including the euro and yen, after falling to the lowest level since January yesterday. A private report yesterday based on payrolls showed unexpected U.S. job losses in September.
The dollar traded near a 15-year low against the yen and close to an eight-month low against the euro before reports forecast to show an increase in initial jobless claims and the unemployment rate.
A rally in regional equities and concerns about possible supply disruptions amid shrinking global stockpiles helped support copper prices. The MSCI Asia Pacific Index of stocks reached a two-year high today as Australian companies hired more people than estimated in a Bloomberg News survey.
Workers at Anglo American Plc and Xstrata Plc’s Collahuasi copper mine in Chile, the world’s largest producer, rejected a wage offer earlier today and will enter negotiations over new contracts before an Oct. 31 deadline, union official Manuel Munoz said in a telephone interview yesterday.
“We retain our positive view on the sector as supply- demand balances are tightening in most metals markets,” Stefan Graber, an analyst at Credit Suisse Group AG, wrote in a note to clients today. “Temporary setbacks should in our view be used as buying opportunities.”
Aluminum and lead in London were unchanged at $2,365 a ton and $2,316 a ton respectively, while zinc was little changed at $2,335 a ton. Nickel rose 0.4 percent to $24,898 a ton and tin gained 1 percent to $26,500 a ton, after reaching a record $26,495 a ton yesterday.
To contact the reporter on this story: Glenys Sim in Singapore at Gsim4@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@Bloomberg.net