Copper Pares Weekly Drop as U.S. Data Buoys Demand Outlook
Copper pared a weekly loss as falling jobless claims, gains in regional manufacturing and better-than-forecast company earnings bolstered the outlook for the U.S., the second biggest user.
Metal for delivery in three months on the London Metal Exchange rose as much as 0.9 percent to $6,970 a metric ton and was at $6,931.75 at 11 a.m. in Tokyo. The price has fallen 0.3 percent this week after gaining in the previous two weeks.
Claims for jobless benefits in the U.S. dropped to the fewest since early May while the Federal Reserve Bank of Philadelphia’s general economic index increased to 19.8, the highest since March 2011, data released yesterday showed. Of the 82 Standard & Poor’s 500 members that have released earnings so far this reporting season, 73 percent have topped analysts’ profit projections, and 52 percent have beaten on sales, according to data compiled by Bloomberg.
“The U.S. economy is improving, supporting copper,” said Hiroyuki Kikukawa, the general manager of research at Nihon Unicom Inc. in Tokyo. A gain in canceled warrants, or orders to remove metal from LME warehouses, also boosted prices, he said.
Orders to remove copper from LME warehouses rose 1,325 tons to 336,600 tons, compared with total stockpiles of 640,600 tons, data from the bourse showed yesterday.
“The tightness in the spot market is suggesting that dips should be bought,” said Jonathan Barratt, the chief executive officer of Barratt’s Bulletin in Sydney.
Copper for delivery in November on the Shanghai Futures Exchange climbed 0.6 percent to 49,970 yuan ($8,138) a ton. Futures for delivery in September on the Comex added 0.5 percent to $3.1475 a pound.
On the LME, aluminum, nickel, lead and zinc also rose, while tin declined.
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