Copper futures rebounded from a one-week low as signs that Europe’s recovery is starting to gain traction buoyed prospects for metal demand.
European Central Bank President Mario Draghi refrained from signaling that any new measures were needed to boost the recovery. Italian Prime Minister Enrico Letta won a confidence vote in parliament, avoiding the need for another election. The euro strengthened the most in two weeks against the dollar, boosting the appeal of commodities as alternative investments.
“Europe’s recovery looks like it’s starting to work out better, and the selloff in the dollar is very bullish for copper,” Michael Smith, the president of T&K Futures & Options in Port St. Lucie, Florida, said in a telephone interview. “Europe and Asia seem to have put the worst behind them, and that bodes well for demand.”
Copper futures for December delivery added 1.3 percent to settle at $3.316 a pound at 1:08 p.m. on the Comex in New York. Earlier, the price touched $3.248, the lowest for a most-active contract since Sept. 24.
Gains may be limited by concern that a partial closing of the government will curtail a rebound in the U.S., the world’s biggest economy, Smith said. Lawmakers remained in a standoff over the budget as the shutdown entered a second day.
Copper stockpiles monitored by the London Metal Exchange fell for the 20th straight session to 531,875 metric tons, the lowest since March 15.
On the LME, copper for delivery in three months climbed 1.1 percent to $7,279 a ton ($3.30 a pound). Aluminum, lead and zinc also rose. Tin declined, while nickel was unchanged.