Copper Futures Climb Most in Week as U.S. Building Permits SurgeJoe Richter
Copper rose the most in a week as a report showing U.S. building permits at an almost five-year high pointed to recovery in the housing market and more demand for the metal used in wires and pipes.
Building applications increased 14 percent to a 1.02 million annualized rate in April, the highest since June 2008 and above the 941,000 median forecast in a Bloomberg survey, a government report showed today. The surge overshadowed a slump in housing starts, said Jeffrey Friedman, a senior commodity broker at RJO Futures.
“The permits number suggests more optimism and more commitment to break ground on new houses,” Friedman said in a telephone interview from Chicago. “Houses use a lot of copper, so while the market hasn’t completely recovered, the report is a good sign.”
Copper futures for delivery in July gained 0.9 percent to settle at $3.2945 a pound at 1:13 p.m. on the Comex in New York, the biggest advance since May 8.
The Copper Development Association says that construction generates 40 percent of demand for the metal. The U.S. is the largest consumer after China.
Prices earlier retreated as much as 1 percent. The metal also rebounded as the dollar erased gains against a basket of six currencies, boosting the appeal of commodities as alternative assets.
The metal lost 2.8 percent in the past two days on concern that demand is slowing in China. In the four months ended April 30, Chinese refined-copper production climbed to 2.1 million metric tons, the most for the period since at least 1990, official figures compiled by Bloomberg show.
On the London Metal Exchange, copper for delivery in three months climbed 1.1 percent to $7,280 a ton ($3.30 a pound). Aluminum, lead, tin and zinc also rallied in London. Nickel was little changed.