Copper gained the most in almost four months as hiring increased and purchases of new homes in October surged by the most in three decades in the U.S., adding to signs that demand for the metal will rise.
Companies boosted payrolls by 215,000 in November, figures from the ADP Research Institute showed, topping the 170,000 forecast of economists surveyed by Bloomberg. New-home sales jumped more than 25 percent, the biggest one-month surge since May 1980, a government report showed today. Copper fell in the prior two days amid concern that stronger growth may spur the Federal Reserve to curb its stimulus measures.
“People are starting to realize that the worst is probably past for metals, so any good economic news is going to push prices higher now,” Michael Smith, the president of T&K Futures & Options in Port St. Lucie, Florida, said in a telephone interview. “The markets have already factored in slowing stimulus.”
Copper futures for delivery in March added 2.6 percent to settle at $3.249 a pound at 1:21 p.m. on the Comex in New York, the biggest gain for a most-active contract since Aug. 8.
Manufacturing in the U.S. unexpectedly sped up at the fastest pace in more than two years, a report showed Dec. 2. China is the biggest copper consumer.
The economy probably added 185,000 jobs last month, according to a separate survey before a government labor report scheduled for Dec. 6.
“Expectations for a solid payrolls number are building,” RBC Capital Markets LLC said in a report today. “The metals complex really needs a catalyst to get any rally going.”
On the LME, copper for delivery in three months rose 1.9 percent to $7,095 a ton ($3.22 a pound).
LME traders must settle options positions today. Copper contracts expiring this month account for about 46 percent of total options open interest, according to exchange data.
Aluminum for delivery in three months gained 1.9 percent to $1,772 a ton. Orders to draw the metal from warehouses climbed to 2.24 million tons, the highest since July, and surged to a record in Detroit.
Zinc, nickel, tin and lead also advanced in London.
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