Copper Futures Advance Most in Five Weeks on China’s Stimulus

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Copper futures climbed the most in five weeks on moves to ease a credit crunch in China, the world’s top consumer of industrial metals.

China granted an additional 1 trillion yuan ($161 billion) quota to provinces to swap high-interest debt into low-cost bonds. Copper advanced for the fourth straight session, the longest rally since May 1. Inventories monitored by exchanges in London, Shanghai and the U.S. have dropped 22 percent from this year’s high on March 17.

“I would agree we still expect more stimulus measures to be implemented over the coming months, which would clearly support prices,” Daniel Briesemann, an analyst at Commerzbank AG in Frankfurt, said in a telephone interview. “We’ve been hearing such rumors from our clients for weeks now.”

Copper futures for July delivery rose 1.2 percent to settle at $2.747 a pound at 1:18 p.m. on the Comex in New York, the biggest gain for a most-active contract since May 1.

Stockpiles tracked by the London Metal Exchange fell for the fifth straight session to 308,025 metric tons, the lowest since March 3. In May, inventories dropped 4.7 percent, snapping a nine-month increase, the longest run since April 2002.

“There is no real sign of any huge increases in supplies,” Steve Hardcastle, the head of client services for industrial commodities at Sucden in London, said in a telephone interview.

Copper for delivery in three months climbed 1.1 percent to $6,030 a ton ($2.74 a pound) in London. Aluminum, nickel and tin gained, while zinc and lead dropped.