US copper futures rose more than 2 percent in early business on Friday, with stronger tones in global equity markets underpinning the early advance, traders said.
"I still think the market is playing an industrial game right now. I think it's going to stay locked up with the stock market," said Scott Meyers, senior trading analyst with Pioneer Futures in New York.
"As you get good news out of the stock market, you're getting good news in the metals and that's the way it has been going lately. The nervousness in the economy and the markets in general, with the subprime problems, are affecting the (metals) markets all in tandem," he said.
By 10:24 am EDT (1424 GMT), copper for December delivery was trading up 4.60 cents, or 1.37 percent, to $3.3940 a lb on the New York Mercantile Exchange's COMEX division, dealing between $3.33 and $3.42. Technicians pegged support in the December contract at the $3.25 level, while resistance continued to lurk at $3.50.
Futures volumes were estimated at 2,832 lots by 9 am. The Dow Jones industrial average cut gains but remained in positive territory on Friday after Federal Reserve Chairman Ben Bernanke said it was not the central bank's job to bail out lenders and investors and offered no clear clues about the outlook for interest rates.
From his speech in Jackson Hole, Wyoming, Bernanke said the Federal Reserve would be set to act as needed to limit the impact of financial turmoil on the economy, but will not bail out investors who made poor decisions.
"The committee continues to monitor the situation and will act as needed to limit the adverse effects on the broader economy that may arise from the disruptions in financial markets," Bernanke said in a speech to a symposium organised by the Kansas City Federal Reserve.
In economic data, core US consumer prices rose by a less-than-expected 0.1 percent in July, showing stable prices that held the year-on-year rate of non-food, non-energy inflation to 1.9 percent for the second month in a row, the Commerce Department said on Friday.
Also, US consumer sentiment worsened in August from July, falling to its lowest level in 12 months as households grew uncertain about economic prospects due to high food and fuel prices and recent financial market turmoil.
On the fundamental front, industrial action in Mexico and a potential strike in Peru continued to offer support to the market. On Wednesday, workers at Southern Copper's Cuajone and Toquepala mines and the Ilo smelter in Peru announced a plan to down their tools on September 12, after rejecting the company's wage offer about two weeks ago. Southern Copper is controlled by Grupo Mexico, which has had its own share of labour problems.
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