Copper futures rose to a two-week high amid investor optimism that Europe will contain its sovereign debt crisis.
European and U.S. equities rose, and the euro climbed to a three-week high against the dollar and the yen as European Commission President Jose Barroso called for a “coordinated approach” to recapitalize the region’s banks. Germany and France have pledged to draw up a plan by early November.
“We will be moving higher over the very short term, teeing off the better tone in the equity markets and cautious optimism that some sort of comprehensive package will come out of Europe,” Edward Meir, a senior commodity analyst at MF Global Holdings Ltd. in Darien, Connecticut, said in a report.
Copper futures for December delivery gained 3.1 percent to close at $3.3935 a pound at 1:24 p.m. on the Comex in New York. Earlier, the price reached $3.4115, the highest for a most- active contract since Sept. 28.
The metal has climbed 13 percent from a 14-month low of $2.994 on Oct. 3.
At the end of last year, domestic stockpiles in China, the world’s biggest metals buyer, totaled 1.9 million metric tons, the Financial Times reported today, citing the China Non-Ferrous Metals Industry Association.
“I am not surprised by the number,” Catherine Virga, the director of research at CPM in New York, said in a telephone interview. She had estimated it to be at least 1.63 million tons.
“Traders bought more copper when arbitrage trades became more profitable,” Virga said.
On the London Metal Exchange, copper for delivery in three months rose 3.2 percent to $7,525 a metric ton ($3.41 a pound).
Aluminum, zinc, lead, nickel and tin also gained in London.
To contact the reporter on this story: Yi Tian in New York at email@example.com
To contact the editor responsible for this story: Steve Stroth at firstname.lastname@example.org