SINGAPORE: London copper rose to a one-week high on Thursday as the market reopened after the Christmas break, with Shanghai copper extending gains on data showing strong corporate profits in the world's top copper consumer China.
Profits earned by China's industrial companies jumped 22.8 percent in November from a year earlier, accelerating from October's 20.5 percent, data from Beijing showed.
"People are hopeful that China's economy will recover next year," said Zhang Ao, an analyst at Minmetals Futures, adding that the climb in China's stock market also helped lift the mood in base metals.
The benchmark Shanghai Composite Index rose to its highest in nearly six months.
Three-month copper on the London Metal Exchange gained 1.7 percent to $7,932 a tonne by 0157 GMT. It rose as high as $7,945.25 earlier, the highest since Dec. 19.
The most-traded April copper contract on the Shanghai Futures Exchange rose 0.7 percent to 57,550 yuan ($9,200) a tonne.
Some cautioned that the thin holiday trade exaggerated the price movement, while the physical market remained sluggish.
"Trading volume in the physical market is quite slow as traders are tight on cash near the year end," said a Shanghai-based trader. "I don't see any significant change on the macroeconomic environment or policy."
The US budget talks return to the centre stage as investors watch if the White House and Republicans can reach a deal to avert massive tax hikes and spending cuts as the deadline is only a few days away.
A failure to reach an agreement would risk tipping the US economy back into recession.
In industry news, workers at the world's biggest copper mine, Chile's Escondida, have rejected an early pay offer made by mine controller BHP Billiton, a union leader said on Wednesday.
Center>Copyright Reuters, 2012
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