Copper Rebounds Amid Speculation Cyprus Will Avert CollapseJoe Richter
Copper climbed in New York, narrowing this week’s drop, on speculation that Cyprus is moving closer to a deal aimed at averting a financial collapse that threatened to worsen Europe’s debt crisis.
Stocks and the euro extended gains after Averof Neofytou, deputy president of Cyprus’s ruling Disy party, said he believes lawmakers will reach an agreement in the next few hours. On March 19, copper slipped to the lowest price since August. The dollar fell against a basket of six currencies, boosting the appeal of commodities as alternatives assets.
“The thinking is that Cyprus will get a bailout, and so people are relaxing a bit,” Matt Zeman, a strategist at Kingsview Financial in Chicago, said in a telephone interview. “That and the weaker dollar are giving the market some appetite for risk.”
Copper futures for delivery in May rose 0.9 percent to settle at $3.466 a pound at 1:13 p.m. on the Comex in New York. The metal fell 1.5 percent this week.
Prices also gained as a port strike in Chile, the world’s biggest producer of the metal, hindered shipments. Workers at the port of Angamos in the Antofagasta region began their walkout on March 16 to push for better conditions. Unrest has delayed the loading of copper from Codelco onto one vessel, an official from the state-owned mining company said by telephone on March 20.
“It’s been enough to give the market a boost and a reason to buy,” Harry Denny, a broker at Hoboken, New Jersey-based PVM Futures Inc., said in a telephone interview.
Some Chinese buyers are capitalizing on gaps between prices in Shanghai and London, Newedge Group SA said. Copper in Shanghai was about 700 yuan ($112) a metric ton more expensive than in London yesterday, according to figures compiled by Bloomberg, giving more incentive to import. That compares with an average discount this year of about 311 yuan.
On the London Metal Exchange, copper for delivery in three months added 1 percent to $7,655 a ton ($3.47 a pound).
Tin, nickel, lead, aluminum and zinc advanced in London.