Comex copper futures ended firmer on Thursday, reversing the previous day's losses as buyers took advantage of the lows carved out when participants sold the red metal ahead of the Federal Reserve's interest rate increase on Wednesday. On Thursday, many players reckoned the copper selling had gone too far and bought the red metal back, especially once the dollar gave back all of its gains and more.
Benchmark December copper on the New York Mercantile Exchange's Comex division firmed 0.95 cent to close at $1.3725 a lb.
The contract reached a one-month high at $1.3870 from a session low at $1.3590 a lb. Spot November copper also rose 0.95 cent to finish at $1.3925 a lb.
The rest were mostly up 1.00 cent at the end.
Comex estimated final volume at healthy 17,000 contracts, up from 15,231 at Wednesday's close.
Traders said copper fundamentals, like the Chilean miner's strike and inventories at lows dating back to 1990, still favour higher prices, despite short-term attempts to grab profits.
"People keep trying to pick the top of the market. They sell it, then they have to cover at the end of the day. It's an endless cycle.
That's what happened today," a dealer said. Among the copper bullish factors was another large drawdown in already low inventories. A copper drawdown of 1,550 tonnes from London Metal Exchange warehouses on Thursday, brought total LME stocks down to 68,625, their low of 14 years.
Elsewhere, union officials representing striking workers at Phelps Dodge Corp's majority-owned El Abra copper mine in Chile said output has fallen by 25 percent since 200 workers for subcontractors joined the seven-day-old strike.
But, a mine official said copper production in cathodes has risen since the strike started.
In addition, the dollar inched lower against the euro on Thursday, but traders mostly staked out neutral positions after the dollar hit an all-time low versus euro this week.
A weak dollar enhances overseas investors' profits on dollar-denominated assets like copper.
"If you look fundamentally," one dealer said, "there are a number of things that suggest copper's going up you still have the (Chilean) strike going on, you have equities heading higher, you have a strong economy, and strong jobs, and you have tight supplies and no build up of stocks anywhere."
LME three-month copper had jumped to $2,987.50 a tonne by the kerb close on Thursday, up from Wednesday's finish at $2,960 a tonne. LME copper nudged briefly above the psychologically potent $3,000 per tonne level.
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