- Zinc advances to highest since October as global stocks climb
- Economic data from U.S., Australia buoys investor confidence
Copper futures climbed to the highest in more than three months and mining companies advanced after better-than-expected economic data in the U.S. and Australia bolstered speculation that demand will improve.
Global equities reached an almost two-month high after a report Tuesday showed U.S. factory activity in February shrank less than forecast, while Australia’s economy expanded faster than expected last quarter. A gauge of 74 mining stocks advanced for a fourth day, led by Vancouver-based First Quantum Minerals Ltd. On Tuesday, copper in New York closed above the 100-day moving average for the first time since June.
“Base metals are building upside momentum after constructive technical closes yesterday,” Michael Turek, head of base metals at BGC Partners Inc. in New York, said by e-mail. “Improvements in global manufacturing data and chart formations are combining to create much more positive sentiment.”
Copper futures for delivery in May advanced 1.7 percent to settle at $2.181 a pound at 1:20 p.m. on the Comex in New York, and touched $2.19, the highest for a most-active contract since Nov. 12. On the London Metal Exchange, copper for delivery in three months gained 1.6 percent to $4,790 a metric ton ($2.17 a pound), crossing above the 100-day average of $4,716.48.
Copper’s advance above its 100-day moving average is a “very bullish signal for trend-following traders” and should spur some to close out bearish bets, Keith Wildie, a partner at London-based brokerage Vantage Capital Markets, said by e-mail.
- Copper has rebounded from a six-year low set in January, after dropping 25 percent last year as slowing growth in China hurt demand.
- Recent gains probably won’t last as a global surplus will persist through this year and next, Oscar Landerretche, chairman of the world’s biggest copper producer Codelco, said in an interview.
- BHP Billiton Ltd., the world’s biggest miner, advanced as much as 5.9 percent in London, while Phoenix-based Freeport-McMoRan Inc. climbed 15 percent and was among the leaders on the Standard & Poor’s 500 Index on Wednesday.
- Aluminum, zinc, lead, nickel and tin also gained on the LME.