Copper futures gained the most in more than a week after U.K. industrial production unexpectedly increased, easing concerns on the outlook for growth in Europe and signaling increased demand.
Output in the U.K. advanced the most in six months in March as manufacturing climbed for a second month, a government report showed Tuesday. The dollar fell against a basket of 10 currencies, increasing the appeal of commodities as alternative investments.
The U.K. report “could be working into a larger theme that Europe is performing better than expected, and copper being an industrial metal is going to respond well to growth,” Tim Evans, the chief market strategist at Long Leaf Trading Group Inc. in Chicago, said in a telephone interview. “Occasionally, the market actually does fundamentally what you’d expect it to do, and we’re seeing the market do that today.”
Copper futures for July delivery climbed 1 percent to settle at $2.9315 a pound at 1:21 p.m. on the Comex in New York, the biggest gain since May 1.
Orders to remove copper from warehouses monitored by the London Metal Exchange climbed 12 percent to 107,700 metric tons, the highest in a year. Thirty-two percent of LME copper stockpiles are now booked for delivery, the highest proportion since June.
“This is another fundamental factor supporting copper,” Evans said.
Copper for delivery in three months climbed 1.2 percent to $6,440 a ton ($2.92 a pound) on the LME. Aluminum, zinc, lead, nickel and tin also gained in London.