Copper rose for a second straight session in New York as an unexpected gain in U.S. retail sales eased concern that slowing industrial growth in China will curb demand for metals.
Sales at U.S. retailers climbed 0.1 percent in April, beating the forecast for a 0.3 percent drop in a Bloomberg survey of economists. The report adds to signs of an improving U.S. economy as housing and hiring improve, helping erase copper losses after a report showed a smaller-than-expected increase in industrial output from China, the largest metals user.
“We know China has slowed, but it’s starting to look like a lot of economies have bottomed, and the retail-sales report gives the market some confidence,” Michael Smith, the president of T&K Futures & Options in Port St. Lucie, Florida, said in a telephone interview.
Copper futures for delivery in July climbed 0.2 percent to settle at $3.3595 a pound at 1:09 p.m. on the Comex in New York, after dropping as much as 0.5 percent. The metal has lost 8 percent this year on concerns of slowing demand in China.
Chinese refined-copper usage may speed up this year from 2012, Duan Shaofu, deputy head of the heavy metals department at the China Nonferrous Metals Industry Association, said by telephone today. Industrial production rose 9.3 percent in April from a year earlier, China’s statistics bureau said, below the 9.4 percent median estimate of economists in a Bloomberg survey.
Money managers reduced their net-short position, or wagers on falling copper prices, by 28 percent to 16,798 Comex futures and options contracts as of May 7 from 23,368 a week earlier, according to the U.S. Commodity Futures Trading Commission. The investors have been betting on declines since late February.
On the London Metal Exchange, copper for delivery in three months rose 0.5 percent to $7,415 a metric ton ($3.36 a pound).
Nickel and aluminum slid in London, while lead, zinc and tin gained.